Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

India’s demand for stainless steel (SS) is expected to be 3.5mn mt in 2021 and projected to grow to 4.5mn mt by 2024 and 7mn mt by 2031. In three years, it is likely to jump 28pc and in 10 years, it will expand by 100pc. This was discussed in a recently held webinar on ‘Stainless Steel and its Growth in India’, in which industry experts emphasized on the need for recycling. 


KK Pahuja, president of Indian Stainless Steel Development Association, said that combination of structural policy reforms and newer applications of SS and cyclical revival factors are playing out in the industry at present, which will improve demand for this metal. 


There is a possibility that incentives for farming sector could also aid SS industry with the construction of food storage, dairy, and sugar mills, among others. If industries focus on adoption of better construction material with low maintenance cost that could last over 100 years, it would be beneficial for the growth of the country, he said. Healthcare, defence and aerospace will spur the demand for superior material and alloys, he said, in addition to the electric vehicles segment. 


Pahuja said SS demand will accelerate in both traditional and non-traditional usages. He voiced his support for ‘Make in India’ and to limit imports of SS products. The revocation of countervailing duty on certain SS products is likely to hurt the domestic industry and lead to glut of imported products primarily from China which produces SS in surplus, he noted. 


Dr. Vijay Kumar Saraswat of NITI Ayog was the key note speaker at the webinar, and said the future is bright for SS which has taken a march over carbon steel. SS grew by over 7.2pc CAGR between 2013-2019 and carbon steel only 5pc. Utilization of SS has increased due to its various properties including highly corrosion resistant and light weight and low maintenance, he said. 

India is the second largest consumer of SS after China. In 2019, consumption per capita was 2.5mn mt which is still below the global average of 7mn mt. The healthy demand from several sectors like, architecture, building, auto, railways and construction will continue to climb, he said. 


Largest consumer of SS is the consumer goods sector in India. Next is processing, ABC (Architecture, Building and Construction) and ART (Automotive, Railways and Transport). Oil and gas sector, petrochemicals, mining equipment are also significant consumers of SS. 


Issues faced by the SS industry

  • -Cheap imports from China
  • -Non-availability of nickel in India
  • -Price volatility of nickel in international markets
  • -Current capacity utilization is low for flats and long
  • -Lack of indigenous melting scrap
  • -High-freight cost in India


Pahuja emphasized on the need to recycle SS products efficiently which is a solution for some of the issues. He added that advantages of the growing demand should go to the domestic players and not to countries that are known for unfair practices. Participants agreed that SS is a green material and more than 50pc of SS production is sourced from scrap. Saraswat said that scrap collection in India is struggling and not efficient, which is a major cause for higher import of scrap. 


All basic raw material prices for SS has increased in 2020, said Saraswat. Rising nickel prices is a major concern for the industry. Product pricing in India are, however, in line with import prices as input prices have increased globally said Pahuja. There is no substitute for nickel, moly and cobalt are not suited enough to replace nickel. 


SS industry has recovered strongly from the pandemic and this will only accelerate further with the roll-out of vaccines, said Pahuja.

Leave a Reply

Your email address will not be published.