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Weakened Asian order book and competitively priced Chinese offerings saw Indian steel exports take a hit in May, dipping 42 per cent over the same period last year. Finished steel exports in May were around 6,82,000 tonnes, flattish on a month-on-month basis.
In April and May, exports declined 35 per cent, year-on-year (y-o-y) to 13,58,000 tonnes. Steel exports have been declining since March. “Bookings had been done previously and mainly to Europe, while demand from Vietnam, amongst top buyers of Indian steel, was weak,” exporters told BusinessLine.
Flat sales slowdown
The flat product category, which accounts for 75 - 80 per cent of exports, stood at 11,88,300 tonnes, down 31 per cent, Steel Ministry data accessed by BusinessLine revealed. Flat products include plates, hot-rolled sheets, hot-rolled coils and strips, tin plates, cold-rolled coils and sheets.
The drop in demand for non-flat products – bars, rods, structural and railway materials – was the sharpest. The two-month export numbers were down 48 per cent, y-o-y, at 1,70,000 tonnes. The fall in billet and slab sales (considered as semi-finished) for April – May was 40 per cent over the same period last year at 4,61,300 tonnes.
“Export orders have been further hit in June and with the imposition of duty by the Centre. India’s offerings are at least 10 per cent costlier over Chinese competition,” exporters said. The impact of export duty imposition is also expected on July orders, initial bookings of which have been slow.
Vietnam sales hit
According to trade sources, sales drop in Vietnam is pegged between 50 and 80 per cent. The combined April-May exports was around 67,000 tonnes. The end-users preferred domestic steel at a lower price. China exported large volumes at competitive rates and EU quotas limited imports (thereby limiting sales here).
“Mills received practically no offers for Indian stocks from Vietnam,” a trade source said. Vietnamese mills normally procure hot-rolled coils from India, value-add for onward exports to the EU. However, the import quotas are limiting such sales and stocks pile up in domestic markets.
EU sales
On the other hand, Italy emerged as a key buyer with finished steel sales (excluding alloy and stainless steel) for the two months being 3,03,000 tonnes (up on a month-on-month comparison). Belgium was another big buyer with sales to the European nation being around 1,79,000 tonnes. This apart, Turkey and Nepal were among the larger export markets with sales being around 1,13,000 tonnes and 93,000 tonnes, respectively.
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