India is emerging as one of the larger importers of Russian steel over the last few months. Cheaper offerings over Indian-finished steel has been the prime draw for traders. Orders of around 300,000 tonnes of steel have been placed with most of the deliveries scheduled in September.

According to trade sources, 157,000 tonnes of imports were made by August-end, mostly by secondary steel traders. And, at least, another 150,000 tonne of steel shipment are currently on high seas.

Three shipments, set to be delivered between August and September, are expected to land on the western ports - either at the JNPT or Kandla. Some Indonesian shippers are reportedly bringing in the cargo, sources said.

Three shipments, each valued between ₹50,000 and ₹60,000/tonne, are set to be delivered between August and September. One shipment was delivered in August; and two more are expected in September – each having a capacity of 70,000 tonne. Shipments are mostly of rolled steel, coatings, flats, and long steel offerings.

“Actually, the way you have to see the Russian cargoes is that, there are 5 cargoes that were booked in India from Russia. They range from ₹60,000, ₹61,000, down to maybe ₹51,000. But, that’s not the average. The duty also would be applicable on imports of Russian arrivals,” said Jayant Acharya, Deputy MD, JSW Steel, post the Q1FY22 earnings conference call.

Incidentally, India turned net importer of steel in July – for the first time since January 2021 – following a slump in exports during the month. Around 444,000 tonnes of finished steel was imported, an 8 per cent increase YoY, data compiled by the Steel Ministry showed. Against this, the export of finished steel was 380,000 tonne.

Cheaper offerings

Sources said, Russian steel, now being imported, is coming at 10 – 20 per cent lower cost over Indian offerings. Previously, the offerings came at a 5 – 10 per cent discount; but after steel prices globally saw a decline and there is an increased stock pile, some players offered higher discount to Indian buyers.

Most of the steel that is being brought in is finding use in some construction activities.

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Traders have used alternate currencies like Dirham or Yuan or HK Dollar to make settlements, it is being said.

“There is excess stock with Indian steel mills as exports continue to be slow. Now, imports from Russia are picking up. So, definitely there is some concern. However, we hope these are short-term bookings and will normalise over a period of time,” official at a Indian steel major said.

Meanwhile, Indian steel mills are said to have an excess stock of 10 – 11 lakh tonne with them. Production of finished steel rose by 9 per cent YoY and 2 per cent MoM to 9.6 million tonne (mt) in July. Consumption was over 9 mt, up 12 per cent YoY and 4 per cent, MoM.