Economy

Steel imports up 10% as demand revives

Our Bureau Mumbai | Updated on August 18, 2020 Published on August 18, 2020

Steel imports increased 10 per cent in July to 2.93 lakh tonnes (lt) against 2.66 lt recorded in June as the overall domestic demand picked up after the disruption caused by the Covid pandemic.

The revival in demand in domestic markets pulled down steel exports by 12 per cent to 14 lt against 16 lt logged in June.

In fact, exports more than trebled from 4 lt in April to 13 lt in May but started to taper due to increasing demand in the domestic markets. Steel producers prefer to sell their produce in the domestic market as the realisations are usually higher, though the trend has reversed in recently.

Exports have seen a quantum jump in the last three months due to significant demand from China, Spain and Italy, said Care Ratings.

Steel production, which had fallen to record low levels in April due to Covid-19 induced nation-wide lockdown, has shown a ‘V’ shaped recovery since then. It improved sequentially for the third straight month in July to 7.6 million tonne, up 9 per cent compared to 6.9 mt logged in June.

Finished steel production jumped to 6.76 mt against 6 mt registered in June. Consumption of finished steel in July recorded an increase of 11 per cent when compared month-on-month.

However, on a year-on-year basis, production of crude steel and finished steel was lower by 20 per cent and 21 per cent, respectively.

International steel prices bottomed out in April but have recovered ever since. Prices have risen month-on-month since April, driven by the increased demand in China. World export steel prices of HRB (hot-rolled bars) have risen 11 per cent since April on the back of a 16 per cent rise in steel prices in China, said Care Ratings. In the domestic market, steel prices in July were down three per cent due to the decline in exports and increase in imports.

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Published on August 18, 2020
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