Demand for Indian steel in key export markets down 17-48% in June quarter

Export of finished steel from India to its key markets that include Europe, and West Asia, saw a fall 17–48 per cent fall in April – June period (Q1FY23), due to factors such as high export duty (imposed in May), competitive price from China and global consumption slowdown. Steel export in Q1FY23 was down by 39 per cent y-o-y.

Data of steel shipments from different ports—Goa, Mumbai, Gujarat, Dhamra, Paradeep, among others—show a similar fall between 3 and 47 per cent.

Shipments to Belgium, Italy drop

Finished steel include flat, longs and alloy and stainless steel offerings. As per data compiled by the Union Steel Ministry, and accessed by BusinessLine, two of the key European markets – Belgium and Italy, saw a 27 and 47 per cent fall in steel exports for Q1FY23, to approximately 3,98,000 tonnes and 2,62,000 tonnes respectively. Steel exports in these countries in the year-ago-period was 5,47,000 tonnes and 4,97,000 tonnes.

In the West Asian markets of Turkey and UAE – two countries that had driven Indian steel exports last year – the y-o-y fall (Q1FY23 vs Q1FY22) is 18 per cent and 15 per cent respectively. For instance, Turkey brought 1,92,000 tonnes of steel in Q1FY23 versus 2,33,0000 tonnes in Q1FY22. The UAE imported 1,85,000 tonnes of Indian steel, in the period under review, versus 2,17,000 tonnes, for the same period last year.

In its own neighbourhood, exports to Nepal fell over 28 per cent, y-o-y, to 1,31,000. Vietnam, another key market, too saw drop in imports..

The Ministry data shows, across other export markets—which include Vietnam, Spain, the United Kingdom, and other countries—the fall was a steep 46 per cent, y-o-y. “The effect of a high export duty was reflected in June orders. Month-on-month, June exports were down over 20 per cent. Moreover, demand from key markets was weak and Chinese offerings were at a price lower than ours. So our exports were badly hit,” an Indian steel mill official said. “Recessionary pressures are there too,” he added.

Long, flat pull down exports

As per Ministry data, flat product exports saw a 41 per cent decline, y-o-y, in the period under review.

Amongst the categories, cold rolled coil and sheet exports saw the highest fall and stood at 1,16,000 tonnes, down 62 per cent. Export in the year-ago-period was 3,05,000 tonnes.

Hot rolled coil sheet, and hot rolled coil strips fell 48 per cent and 42 per cent, respectively, for the June-quarter. Tin plate sales were down 46 per cent for the period.

The hit in non-flat products (also called longs) exports was over 57 per cent. Bars & rods and railway material—part of long products— exports fell 67 and 70 per cent, respectively.

Export of semi-finished products—billets, slabs, etc—fell 43 per cent in Q1FY23, the Ministry data showed.

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