Steel Storm: India's Domestic Industry Faces Import Surge Battles

A recent report highlights the escalating pressures faced by India's domestic steel industry due to increasing steel imports. The surge, primarily driven by lower-priced imports from several Asian countries, is impacting profit margins and is expected to intensify in the second half of FY25.

The surge in steel imports has placed significant pressure on the profit margins of domestic steel producers, and these challenges are anticipated to heighten in the latter half of the current fiscal year, according to a recent report.

The analysis released by India Ratings and Research (Ind-Ra) examines the global factors contributing to the rise in steel imports to India, the potential future import trends, key contributing exporting nations, and the domestic supply-demand equilibrium.

Particularly since the third quarter of FY24, the influx of steel imports into India, largely from China, Vietnam, Japan, and Korea, has drastically affected the gross margins within the domestic steel sector. Ind-Ra predicts that this margin pressure will likely grow more pronounced over the second half of FY25, as China's steel export volumes recently reached a 21-quarter high, due to falling domestic steel prices.

(With inputs from agencies.)