China has emerged as the biggest destination for Indian steel exports during the first two months of current fiscal year (April-May), data sourced from the Joint Plant Committee (JPC) under India’s Ministry of Steel show.
According to the JPC data, total finished steel exports from India in the April-May period this year amounted to 1.7 million mt, with semis exports totaling 1.3 million mt, and about 48 percent of total outward shipments in the two months went to China.
Indian mills managed to sharply increase billet sales to China. In the given period, finished steel exports from India to China were estimated at 440,000 mt and semis exports at 1 million mt.
In May alone, India exported 834,713 mt of billets and blooms, of which 82 percent was sent to China.
In the HRC segment, the range of export destinations was wider. In May, total HRC exports came to 918,825 mt. Vietnam was the main buyer of Indian coils, but the difference in volume compared to exports to China was minimal. Sales of HRC to Vietnam accounted for 42 percent of total exports of this product from India, while China’s share was 41.7 percent in May. Other major sales destinations were the EU and the Middle East, with exports from India slightly less than 100,000 mt for each of these regions.
According to the financial research and rating agency Icra, Indian steel exports in the April-May period this year increased 76 percent year on year.
“Domestic prices of steel in China have increased significantly. The difference between domestic hot rolled coil (HRC) in China and imports is almost $70/mt,” Sushim Banerkee, director general of the Institute for Steel Development and Growth (Insdag), said.
However, according to Icra, the sustainability of such growth in steel exports from India to China is doubtful as Chinese steel mills rapidly ramp up their own production, while the weak demand outlook in China in summer and in other parts of the world will pose challenges to Indian steel mills.