The slowdown in domestic demand of steel force manufacturers to explore global opportunities, making India the net exporter of steel to China.
Regardless of the border tension with the neighbouring country, the steel exports have accounted for ₹19,267 crore so far, this fiscal, while imports are at ₹16,369 crore. The US and China emerged as the top destinations for steel exports, while China and Germany stood as the top sources of imports for India.
As per reports the overall exports for the current fiscal are expected to surpass that of last year and have already reached 70 per cent of FY21 level.
Exports will continue to remain strong as China has announced a bailout package to sort out the real estate problem.Srinivas Manoharan, President, Shri Bajrang Power and Ispat
India also has a cost advantage over China with the restrictions levied to contain pollution and achieve greenhouse emission targets, he said. Moreover, India has established itself as a credible exporter and managed to capture some of the market vacated by China. In fact, Bajrang Power and Ispat has managed to complete an export order of steel pipes to China and is exploring further opportunities, he added.
India is the third-largest manufacturing hub of steel pipes in the world and steel pipes constitute 8-10 per cent of the steel consumption.
The Tata Steel-JSW Steel-SAIL combine is expected to report a 28% growth in produce this fiscal taking the produce to 21.4 million tonnes (mt.) as compared to last fiscal’s 16.71 mt. The installed capacity is estimated to touch 140 mt by FY25.
A report by Infomerics Valuation and Rating, ‘Steel Industry: Trends & Prospects’ says that the production linked incentive scheme announced for speciality steel- to be implemented over FY24 to FY30 with a budgetary outlay of ₹6,322 crore is likely to further give a boost the steel industry.
However, the report adds that despite sustained production and trade, steel companies are still facing challenges over coal shortage. Further, global inflationary trends also pose a threat of rising prices, including those relating to essential inputs.
Source: Hindu Business Line