Indian steel demand could witness a sharp increase in the coming months as infrastructural projects increase, boosted by financial stimulus.
Steel demand, boosted by financial stimulus and consumption could cross 100mn mt in the ongoing financial year, said steel minister, Mr. Faggan Singh Kulaste. Steel consumption in FY2021, (Apr’2020- Mar’2021) was recorded at 93.43mn mt, down 6.7pc from the prior year.
Following a recovery in productions, Indian crude steel output could rise above 115-120mn mt by the end of FY2022 (Apr’2021-Mar’2022), an increase of a minimum of 15-18pc from the previous financial year, according to a projection by Steel Ministry.
In FY2021 (Apr’2020- Mar’2021), India produced around 102mn mt of crude steel, registering a fall of 6.1pc over FY2020, due to COVID-19 related lockdowns and production cuts.
In the first four months of FY2022, Indian crude output surged by 44.6pc from the prior year to 37.527mn mt.
Infrastructural projects in the pipeline –
The government has announced a Rs1,000mn ($13.7mn) National Infrastructure Pipeline (NIP) plan. Mega infrastructure projects, such as Pradhan Mantri Awas Yojana, Bharatmala, Sagarmala and Dedicated Freight Corridors are on a gradual increase, which could boost the consumption of steel in the country.
Policy support –
Under the Domestically Manufactured Iron & Steel Products (DMI&SP) policy, the government allowed the use of steel produced from secondary steel mills for government projects and undertook various measures to promote locally manufactured steel.
Moreover, the recently announced scrap recycling policy will emphasis on the production of green steel to reduce the country’s carbon footprint.
This will encourage IF/EAF (induction furnace/electric arc furnace) methods of steelmaking.
The present import dependency on other supplier countries for steel scrap and non-ferrous scrap, is at 7mn mt but it will be lowered further in the coming years, said Kulasthe.
The present total demand for steel scrap is over 25mn mt and the estimated domestic scrap generation in India is at 18-20mn mt.