Steel exports from the country are likely to remain low over the balance of the fourth quarter in the current financial year, due to continuing strong domestic demand and robust realisations in the economy. According to credit rating agency India Ratings and Research (Ind-Ra), the finished steel exports in January 2021 totaled 0.58 million tonnes, down six per cent month-on-month and 16 per cent year-on-year as producers focusing more on domestic sales due to robust demand. During the COVID-19 lockdown phase, export volumes were at 8.84 million tonnes, up 23 per cent year-on-year, according to the report.
On the other hand, the finished steel imports were higher by two per cent month-on-month and 8.3 per cent year-on-year at 0.52 million tonnes in January 2021. The country's finished steel imports between April 2020 to January 2021 were at 3.79 million tonnes, registered at 37 per cent lower year-on-year due to COVID-19 restrictions. Also, the reduction in import duties to 7.5 per cent from 10 to 12.5 per cent earlier on all the semi- and finished-alloy and non-alloy steel products must have a stabilising impact on the domestic supplies and steel prices in the near term,
The report by the rating agency said that domestic hot-rolled coil prices corrected by three per cent in mid-February to Rs 53,750/ million tonnes, but are still 40 per cent higher year-on-year. The domestic flat steel prices have decreased due to the rising inventories.
The recent import duty reduction on steel scrap is likely to benefit the secondary steel producers and the temporary suspension of countervailing and anti-dumping duties should bring some stability to steel prices and supply. However, the country's crude steel output in January was at 10 million tonnes, about two per cent higher month-on-month and seven per cent year-on- year.