India’s domestic steel demand grew by 11.9% in the first eight months of the 2022/2023 financial year (April-November), according to the ICRA rating agency.
The infrastructure-driven economic strategy that the government used during this period was largely responsible for the increase in domestic demand. However, it is anticipated that domestic steel consumption will decline to 6-7% in fiscal years 2023/24.
At the same time, it is anticipated that with the elimination of export tariffs, the export of rolled products would increase from the lows that were reached in November 2022; however, it is unlikely that it will return to the levels that were reached in the fiscal year 2020/2021.
ICRA reports that due to the restricted expansion potential for steel production in China, Japan, South Korea, the CIS, Europe, and the United States, India’s imports of rolled products are continually expanding despite these countries’ best efforts. The nation was a net importer of rolled products for the two months that immediately followed one another in 2022 (October and November). It is anticipated that during the fiscal year 2023/2024, the quantity of steel goods imported into the Indian market will continue to constitute a major portion of the total.
Steel producers in India anticipate an increase in prices in January 2023 due to an improvement in the worldwide market. Last week, steel companies withdrew their plans and stated that they would submit fresh ones at the beginning of next year. This boosted optimism on the domestic market, which is anticipated to experience an increase in prices beginning in January.
It is essential to keep in mind that India cut its exports of rolled products by 55% year on year for the first eight months of the fiscal year 2022/2003, reaching 4.3 million tonnes. Both a downturn in demand globally and the imposition of export duties on some steel goods were to blame. The nation’s use of steel climbed by 12 percentage points to a total of 75.3 million tonnes after the first eight months of the fiscal year 2022/2003.
The Government of India will begin applying the Customs Tariff and Export Tax Exemption Scheme (RoDTEP) on steel on December 15, 2022. Pipes and other structural materials for trains are included in the plan. These exports will be subject to the RoDTEP, which allows for reimbursing embedded central and local customs levies and taxes until September 30, 2023.
