The Coal Trader

India Steel Demand Set to Grow Up to 10%

Indian steel demand is likely to grow 8% to 10% in the medium term, underpinned by robust economic growth in the world’s second-biggest consumer of the alloy, according to the country’s largest mill.

JSW Steel Ltd. said it’s forecasting an even more dramatic 15% nationwide expansion in the year through March to 135 million tons, and then very healthy growth through the rest of the 2020s.

“We anticipate that by end of this decade India would consume anywhere between 200 million tons to 210 million tons of steel,” Jayant Acharya, joint managing director at the Mumbai-based producer, said in a Bloomberg Television interview on Tuesday. An expansion of production capacity will mainly serve domestic demand, he said.

The South Asian nation’s output of the metal has been growing to match the needs of its rapid infrastructure expansion in the past few years. Indian mills are expected to add another 38.5 million tons of new capacity by March 2027, according to rating agency ICRA Ltd. Buoyant demand has lured more imports from countries like China, which has emerged as the biggest supplier to India in the last few months.

An increase in Chinese exports spurred by that country’s weak economic situation is putting pressure on the global steel market and it is something JSW continues to monitor, Acharya said.

Other key points from the interview:

  • JSW continues to eye coking coal assets overseas
  • High cost of coking coal and iron ore globally is a point of pressure, but rising steel prices would partially offset the expense