India’s steel imports drop sharply as China and Japan exports decline
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A worker stacks steel pipes in the western Indian city of Ahmedabad November 4, 2014. Photograph: (Reuters)
India’s finished steel imports dropped 27.6% in April–May as safeguard tariffs curbed Chinese and Japanese shipments, while domestic demand and production surged.
India’s finished steel imports fell sharply in April and May, driven by a steep decline in shipments from China and Japan. Provisional government data reviewed by Reuters show imports during the first two months of the financial year fell 27.6 per cent year-on-year to 0.9 million metric tonnes.
The decline follows New Delhi’s decision in April to impose a 12 per cent temporary tariff, known locally as a safeguard duty, aimed at stemming the surge in cheaper steel shipments, particularly from China.
According to the data cited by Reuters, China’s finished steel exports to India fell 47.7 per cent year-on-year to 0.2 million metric tonnes over April and May. Japan saw an even sharper decline, with shipments dropping 65.6 per cent to 0.1 million metric tonnes during the same period.
Despite the declines from China and Japan, South Korea emerged as India’s top finished steel exporter. Shipments from South Korea rose 8.2 per cent to 0.4 million metric tonnes, indicating a shift in sourcing patterns even as overall import volumes contracted.
Imports from China, Japan and South Korea together accounted for 74.4 per cent of India’s total finished steel imports during April and May, the data showed. Hot-rolled coils or strips remained India’s largest import category.
Exports also decline
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India was a net importer of finished steel during the period, as its own exports fell 18.1 per cent year-on-year to 0.8 million metric tonnes, Reuters reported.
Galvanised plain or corrugated sheets or coils remained India’s top steel export products. Belgium was India’s largest export market for finished steel during the period, with shipments rising 12.4 per cent to 0.15 million metric tonnes. However, there were significant divergences among key markets. Exports to Italy slumped 53.7 per cent, while shipments to Nepal and Spain registered increases.
Domestic demand and production rise
Despite weaker imports and exports, India’s domestic steel demand remained resilient. Finished steel consumption in April-May rose 7.1 per cent year-on-year to 25.1 million metric tonnes. Meanwhile, crude steel production increased 9.5 per cent to 26.9 million metric tonnes, underlining the strength of India’s domestic production capacity.
India is the world’s second-largest crude steel producer and has taken measures in recent years to protect its domestic industry from a flood of cheaper imports, particularly from China. The temporary safeguard duty introduced in April is the latest in a series of trade measures aimed at balancing import competition with the needs of India’s growing infrastructure and construction sectors.
(With inputs from the agencies)