A combined impact of duty levy, seasonal weakness in demand and global slowdown in the commodity cycle saw finished steel exports from the country dip by 75 per cent year-on-year (y-o-y) in July. This is the fourth straight month of fall for Indian mills. Just 1,56,000 tonnes were exported last month.
A month-on-month (m-o-m) comparison shows steel exports fell 41 per cent, indicating the continued pressure on demand, provisional data compiled by the Union Steel Ministry showed and accessed by BusinessLine stated. For April-July period (four months of the fiscal), y-o-y fall was 49 per cent.
Finished steel includes non-alloyed offerings (like long and flat products, cold rolled coils, and hot rolled coils) and alloyed and stainless steel offerings. “Transactions for July were even lower than June. Export duty levy and poor demand in global markets led to the fall. If you see category-wise details, fall for non-alloyed exports was a steep 70 per cent, m-o-m,” a trade source said.
Non-alloyed steel worst hit
Non-alloyed steel exports have been worse hit, as per the data. Comparisons show the prime export offering witnessed an 89 per cent fall — its highest percentile fall in recent months — for July, versus the same month last year. Exports in July 2021 were 1,382,000 tonnes. For the April-July period, around 2,041,000 tonne of steel was exported, down by 57 per cent over the same period last fiscal when 4,707,000 tonne was sold.
Alloys buck trend
Interestingly, alloyed steel (which does not have an export duty levy) and stainless steel exports bucked the trend and saw a 33 per cent rise m-o-m and a 72 per cent jump y-o-y, respectively.
Data from the ministry showed that 2,23,000 tonne of alloyed/stainless steel export were recorded in July 2022. In June (the previous month), exports in the category were 1,68,000 tonnes, while in the July 2021 (the year-ago period), they it stood at 1,30,000 tonnes.
For the April-July period, Indian mills exported 5,29,000 tonnes of alloy/stainless steel, up 46 per cent y-o-y. In the year-ago period, sales were 3,61,000 tonnes. “So there have been some increase in demand for alloyed steel but it is a very demand specific — select market, select buyer and so on,” a trade source said.
On a m-o-m basis, finished steel production saw a 3 per cent-odd rise to 9,656,000 tonnes.
Tata Steel saw a 15 per cent m-o-m rise to 1,650,000 tonne — the highest among steel majors. Other players like AM/NS India, JSPL, and JSW, together saw a near 10 per cent rise to 2,264,000 tonnes. SAIL and RINL saw a 5 per cent and 3 per cent — odd rise in monthly production — to 1,193,000 tonnes and 2,93,000 tonnes, respectively.
Alloyed/stainless steel production remained near constant at 5,82,000 tonnes m-o-m, while non-alloyed steel production increased 3 per cent to 9,000,000 tonnes-odd for the period under review.