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The data showed that while prices in April were largely flat year-on-year, prices declined in June and July, by around 5 percent each over the same period.
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Analysts also see a downward pressure on prices in the long term, stemming from global oversupply amid US tariffs and an economic downturn
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After peaking at 18.51 million tonnes in FY22, India's steel exports have been on a decline, falling more than 60 per cent over three years to 6.95 million tonnes in FY25.
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Flat steel prices showed incremental increases at the end of December but analysts say that overall demand momentum is tilted towards long steel products used in infrastructure projects
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Indian steelmakers have been under pressure due to cheaper imports from China, Vietnam, and other countries for the past year. They have been urging the government to put in place trade measures such as tariffs to cushion them from volatility in pricing mechanisms.
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While timing the exact bottom or top is of any sector is unrealistic, being part of the cycle can still generate substantial returns. The key is acknowledging the inherent cyclicality of businesses.
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During Q1FY25, the country saw an increased supply of steel driven by a preference for cheaper imported alternatives and need-based procurement, putting domestic steel prices under pressure.
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Higher capacity addition from large players in the near term might keep steel prices in check while coking coal prices at elevated levels will exert pressure on margins
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In its market intelligence and analytics report, Crisil expects flat steel to hover around Rs 59,000 per tonne and Rs 56,000 per tonne for long steel.
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JSPL has reduced debts and currently focusing on higher volumes and cost-saving projects
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Tata Steel India operations are integrated and the majority of incremental profits will come from India, given the capex guidance.
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Incremental capacity of more than 6 million tonnes to go on stream in the next one year
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JSPL has reduced its debt and is currently focusing on higher volumes and cost-saving projects
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Cautious stance on ferrous space, given the slowdown in developed world and higher production from China
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More than 6 million tonnes of incremental capacity is likely to be commissioned in the next one year
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Slowing global demand, cheap imports, and softer input costs to reverse a nearly six-month rally
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Tata Steel India operations are integrated, and a majority of the incremental profits will come from India, given the capex guidance.
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Exports of steel remains unprofitable given that import prices are lower than domestic prices.
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Investors should watch for recovery in volumes, steel prices
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Investors with interest in JSW Steel need to watch out for domestic steel demand trajectory
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Investors having interest in JSPL need to watch out for its export volumes, debt reduction plans
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In May, the government had waived customs duty on the import of some raw materials including coking coal and ferronickel, which helped reduce prices.
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Ultimately, if prices of this important raw material do dip, it would help auto OEMs in better cost management, right-pricing to improve affordability and generate demand from consumers, and eventually margin expansion
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The Prime Minister’s Office had greenlit higher duties on export of iron ore and removal of import duties on steel inputs such as coke. Designed to reduce the domestic price of steel and ensure stable supply, the move has led to metal stocks melting down.
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Reacting to the government’s move to levy export duty on some steel items, EEPC India Chairman Mahesh Desai said engineering goods manufacturers and exporters would benefit from the move and become more competitive in the global markets.
