India’s steel output dips by 2pc in September

India’s crude steel production dropped by 2pc to 8.62 mn mt in September from the prior year but improved up by 2pc from August, according to official data. 

Almost all domestic steel mills including blast furnaces (BF), induction furnaces (IF) and electric arc furnaces (EAF) have slowly raised their production and are moving towards pre-COVID-19 levels following improvement in domestic steel demand and easing of pandemic restrictions. 

Mills that produced steel through blast furnaces route are expected to register healthy performance in Q2 (September quarter) compare to Q1 owing to successive price hikes since July, optimum capacity utilization levels along with some relief from lower coking coal prices. On an average, most primary steel mills are operating at 80-90pc capacity utilization level in Q2 compared to below 50pc in Q1 of the current fiscal year 2020-21.

In Apr-Sep period, India’s crude steel output declined by 22pc to 42.89mn from the prior period.

Steel exports

India’s finished steel export in September fell by 15pc to 0.864mn mt from the prior year and down by 17pc from the prior month. Exports fell mainly due to primary steel mills’ focus on the domestic market as consumption increased. Meanwhile, mills raised flat steel prices by Rs7,500-8,000/mt from July to October period. 

In Apr-Sep 2020, India’s steel export significantly rose by 66pc to 6.54mn mt from the prior year. Earlier in Apr-Jun (Q1), mills were forced to reduce capacity utilization and looked for exports to offset weak domestic demand and adverse market conditions. 

Steel imports 

Finished steel imports dropped by 44pc to 0.318mn mt in September from the prior year. However, imports significantly rose by 98pc from August. In Apr-Sep 2020, steel import dipped by 51pc to 1.98mn mt from the prior year period.