India continued to be a net importer of steel for April-Jan period of the fiscal (10M FY25) with imports exceeding exports by 4.4 million tonnes (mt). In fact, the trade deficit is higher than India’s steel exports, as per a report of Ministry, accessed by businessline.
In the backdrop of Trump tariffs on steel and aluminium, there are fears of a supply glut in India’s domestic market amidst fears of increased dumping of the metal by Chinese suppliers.
Finished steel imports saw a 20 per cent increase year-on-year (y-o-y) for the 10-month period to 8.3 mt, while exports dipped by 30 per cent-odd to 3.9 mt.
Finished steel includes non-alloyed offerings, alloyed ones and stainless steel. Nearly one out of every three imported item is in the stainless steel category, which rose by 23 per cent y-o-y to 2.2 mt (from 1.9 mt); whereas non-alloyed offerings were to the tune of 6.1 mt, up 19 per cent, for the 10M FY25 period.
In the year-ago period, (Apr–Jan FY24), India was also a net importer of the metal, but with a much narrower deficit of 1.3 mt. Imports stood at 6.9 mt; whereas exports were at 5.6 mt.
Pressure on exports remain
“Key export markets like the European Union continue to have a bleak outlook and consumption was weaker. Major buyers like Belgium, Italy and others were down. In ME, Indian mills are competing with China on price, and are holding back on offers,” an official said, requesting anonymity.
EU’s steel consumption is expected to be lower in CY2024, indicating continued stress across its economies.
A month-wise breakup of the numbers show that finished steel imports have maintained flat numbers — rising just 3 per cent — in comparison to December 2024 and January last year too, at 0.9 mt.
“Imports are still at elevated levels, because corresponding exports have dropped,” an official said.
In comparison, exports saw an over 50 per cent drop y-o-y to 0.4 mt in January, from the same period last year when it was at 0.9 mt; while on a sequential basis — January vs December — there was a 11 per cent drop, from 0.45 mt.
The Trump Factor
So far, India has been amongst the economies which has seen double-digit steel consumption growth, up 11 per cent y-o-y to 125 mt for the 10-month period. As against this, finished steed production was around 120 mt, up 4 per cent y-o-y.
Metal prices of the benchmark hot rolled coils improved by 4 per cent-odd sequentially to ₹48,500 per tonne, as against ₹46,500 per tonne in January. However, steel prices in India has seen a significant 10 per cent y-o-y from ₹54,000 per tonne levels last February.
However, concerns of a supply glut in domestic market is on the rise as Trump’s tariffs choke export markets.
The US President Donald Trump has signed proclamations raising the US tariff rate on steel and aluminium to 25 per cent (from his previous 10 per cent rate in case of aluminium) and eliminating country exceptions and quota deals as well as hundreds of thousands of product-specific tariff exclusions for both metals.
According to Abhyuday Jindal, MD, Jindal Stainless, there is a mechanism in place wherein importers can file for exclusions. Based on the strategic pact signed between India and the US, up to 70 per cent of the exclusion requests are to be considered favourably by the US.
“The industry waits for more clarity in terms of the coverage of tariffs with respect to product line and countries,” he said adding that it is imperative that the trade environment remains conducive to growth.