India’s steel sector has delivered a notable turnaround in FY25, with export performance emerging as a key growth lever amid supportive policy measures and firming global demand. Provisional government data reviewed by Reuters shows that finished steel exports surged 33.3% year on year to 4.8 million tonnes during April–December FY25, positioning India as a net exporter of finished steel over the period.
This marks a decisive shift from recent years, when rising imports and price pressures had weighed on domestic producers.
Production, Consumption, and Trade Balance
During the first nine months of FY25, India’s steel fundamentals remained largely balanced, with capacity utilization staying healthy:
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Finished steel production: 117.6 million tonnes
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Domestic consumption: 119.3 million tonnes
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Finished steel imports: 4.65 million tonnes
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Crude steel production: 123.9 million tonnes
Despite domestic consumption marginally exceeding production, strong outbound shipments ensured that India retained its net exporter status. This reflects improved competitiveness of Indian steel in overseas markets, particularly in flat products.
Note: The marginal gap between finished steel production and apparent demand was largely bridged through inventory drawdowns during the period, a common feature in phases of strong market activity.
Safeguard Duty Reshapes Market Dynamics
A key structural driver behind the improving trade balance has been the government’s decision to impose a safeguard duty on select steel imports, starting at 12% and gradually tapering to 11% over three years. The move is aimed at restricting low-priced imports, especially from China, which had earlier exerted pressure on domestic prices and margins.
The safeguard mechanism has delivered two immediate outcomes:
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Reduced import attractiveness, particularly for flat steel products
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Greater pricing power for domestic mills, allowing producers to recalibrate realizations without significant demand erosion
This policy intervention signals a clear intent to protect domestic capacity while allowing exports to scale up organically.
Domestic Price Firming Reflects Improved Sentiment
Market sentiment strengthened further in January, as major Indian steelmakers announced price hikes of up to ₹2,000 per tonne for HRC and CRC. The increase reflects a combination of:
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Reduced import competition
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Stable domestic demand
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Improving export realizations
While the hikes remain moderate, they indicate growing confidence among producers after several quarters of margin volatility.
Export Markets: The Next Data Point to Watch
While headline export numbers point to a strong recovery, country-wise export data will be critical in assessing the sustainability of this momentum. Early market indications suggest Indian steel is gaining traction in select Asian and European markets, aided by competitive pricing and reliable supply.
However, exporters will need to navigate evolving trade policies, carbon-related regulations, and global demand fluctuations, especially in developed markets.
Outlook
India’s steel sector appears to be entering a more balanced phase, where exports, domestic consumption, and trade protection measures are reinforcing each other. The return to net exporter status, coupled with firmer prices, suggests improved earnings visibility for steelmakers in the near term.
Going forward, the durability of this trend will hinge on global demand conditions, currency movements, and the effectiveness of safeguard measures in maintaining a level playing field for domestic producers.