India Emerge As Steel Exporter To China After Years, Even after various restrictions being performed by the government to curb Chinese imports, the neighbouring country provided immense export support to Indian steel industry saving it from the blushes of weak domestic demand and subsequent fall in production.
According to CRISIL Research, India turned net exporter of steel to China for the first time, with 69 per cent semi-finished steel and 28 per cent of finished steel heading between April and August.
Indeed, it was exports that saw large primary steelmakers through the peak lockdown months, with 60-80 per cent of total production between April and August finding its way with China leading the pack.
Crude steel production fell by 27 per cent despite a massive 38 per cent fall in domestic demand during April-August. The fall in output was severe for export-oriented primary manufacturers.
However, the jump in exports as 400 per cent on-year in June has come off-peak since then, owing to easing of domestic lockdowns and some revival in economic activity.
For China, supply disruptions and elevated global iron ore prices led steel imports in these months, as it imports over 90 per cent of its iron ore requirement.
CRISIL Research expects steel prices to rise here to close at $460-490 per tonne or 3-5 per cent lower on-year.
In India, though, they fall in domestic prices has been limited, owing to rupee depreciation.
August also saw domestic prices climb to 8 per cent on-month on account of a mild recovery in domestic demand.
Thus, while global steel prices will witness a 3-5 per cent drop on-year in calendar 2020, domestic prices are expected to decline only 1-2 per cent, also given that anti-dumping duties are in place.