India’s domestic steel consumption is projected to rise by 9-10% in FY2025, according to a report by ICRA. The first quarter of FY2025 saw a 15% year-on-year growth in demand, although a slowdown is anticipated in the current quarter due to monsoon impacts. ICRA forecasts that steel sector capacity utilization will reach a decade-high of 88%, despite the addition of 15.6 million tonnes per annum (mtpa) of new capacity this year.

Between FY2021 and FY2024, India’s steel industry expanded rapidly, adding 26.3 mtpa of capacity. An additional 27.5 mtpa is expected between FY2025 and FY2027, driven by growing demand and increased imports. India’s finished steel imports rose by 35.4% in Q1 FY2025, continuing last year’s trend.

Despite rising imports, steelmakers are benefiting from lower raw material costs, with Australian coking coal prices down 45% and NMDC reducing iron ore prices by 18%. These reductions are expected to support profitability, though temporary margin contractions may occur in Q2 FY2025.

The Ministry of Steel is scheduled to host an event titled “Greening Steel: Pathway to Sustainability” on 10th September 2024 at the C.D. Deshmukh Hall, India International Centre, New Delhi. The event will bring together representatives from various ministries, Central Public Sector Enterprises (CPSEs), think tanks, academia, institutions, and key players in the steel industry.

A major feature of the event will be the release of a comprehensive report, “Greening the Steel Sector in India: Roadmap and Action Plan,” prepared by the Ministry of Steel. This report, based on the findings of 14 task forces formed by the ministry, outlines the pathway for decarbonising India’s steel sector.

The report will address various aspects of carbon emissions within the steel industry, providing a detailed overview of the current situation, key decarbonisation strategies, technological innovations, policy frameworks, and a future roadmap to reduce emissions in the sector. It will also propose strategies such as energy efficiency, the use of renewable energy, material efficiency, green hydrogen, and biochar to facilitate the transition to sustainable steel production.

The event will also include a panel discussion on “Leadership and Innovation: Driving the Green Steel Transition,” where industry experts will share their perspectives on advancing decarbonisation in the steel sector. The discussion is expected to highlight innovative ideas and leadership insights.

This initiative aligns with India’s commitment to achieving net-zero carbon emissions as part of its nationally determined commitments (NDC). The report is viewed as a significant step in shaping the future of India’s steel industry and guiding it towards lower carbon emissions.

The Minister of Heavy Industries has advocated for a substantial increase in tariffs on steel imported from China. This proposal aims to protect the domestic steel industry from the impacts of cheaper foreign steel flooding the market.

The Minister highlighted that the influx of low-cost Chinese steel has been detrimental to local manufacturers, causing disruptions in the market and undermining domestic production. By raising tariffs, the government intends to level the playing field and bolster the competitiveness of Indian steel producers.

The push for higher tariffs is also part of a broader strategy to enhance the growth and sustainability of the Indian steel sector. The Minister emphasized that such measures are essential to ensure the long-term health and viability of the industry, which is a crucial component of the country’s infrastructure and economic development.

Industry experts and stakeholders have shown support for the proposal, citing that increased tariffs could encourage investment in domestic steel production and reduce dependency on imports. However, there are concerns about potential retaliatory measures from China and the impact on trade relations between the two countries.

As the government considers the proposal, it is expected that consultations with industry players and trade partners will shape the final decision on tariff adjustments. The outcome will be closely watched by both domestic and international markets.