Cheap Chinese Steel Posing a Dilemma to Domestic Steel Makers

India's finished steel imports from China have surged to a seven-year high in the first five months of the 2024/25 financial year, according to provisional government data. During the period from April to August, India imported 1.1 million tons of finished steel from China, marking a 31.7% year-on-year increase. This rise is part of a broader trend in which India's total finished steel imports reached a six-year high of 3.7 million metric tons, making the country a net importer of the alloy.

India, the world’s second-largest producer of crude steel, has seen its domestic consumption of finished steel grow rapidly due to strong demand from sectors such as infrastructure and automotive. China led the way as India's largest exporter of finished steel during this period, followed by South Korea and Japan, with key imports including stainless steel, hot-rolled coil steel, galvanized sheets, and plates.

Amidst this influx of imports, India’s federal steel ministry is considering various trade measures in response to concerns raised by domestic steel mills. In addition to imports from China, India's finished steel imports from Russia also saw significant growth, reaching a six-year high. Russia exported approximately 54,000 tons of finished steel to India during the same period, more than double the amount from the previous year, making it the fifth-largest exporter to the country.

While domestic steel demand remained robust, with finished steel consumption reaching a seven-year high of 60.3 million metric tons, up 13.8% from the previous year, domestic steel prices dipped in August. This decline was attributed to supply-demand imbalances and reduced market offers. Meanwhile, India’s finished steel exports hit a seven-year low, with overall exports at 1.9 million tons between April and August, a sharp 39.6% drop from the previous year. Italy, India’s top export market, saw a steep decline in imports, down 48.3% year-on-year to around 360,000 tons.