India’s crude steel production grew 8.1 per cent in July compared to the corresponding period a year ago. However, global production too witnessed a marginal growth of 1.4 per cent. India’s output stood at 8.1 million tonnes (mt), while it was 133.7 mt globally, despite not-so-strong demand in the domestic market.
According to a report by the World Steel Association (WSA), China’s output was 66.8 mt (up 2.6 per cent), while Japan produced 8.9 mt, (up 0.5 per cent).
The report, which looked at 66 countries, found the global capacity utilisation ratio was stagnant at 68.3 per cent, although there was 3.7 per cent fall on a sequential basis. In the European Union, Germany’s output was 3.4 mt (down 6.1 per cent), while that of the UK was a meagre 0.7 mt (down 27.3 per cent). Meanwhile, output in US was 6.9 mt (down 2.2 per cent).
Despite weak seasonality, analysts said this was a strong performance by India. “We attribute this rise to recent commissioning of capacities by most big integrated producers such as Steel Authority, JSW Steel and Tata Steel,” said Emkay Global in its report. Essar Steel has also been improving its utilization, it said.
Since last few months several measures have been put in place by several countries to protect their steel industries with India being no exception. India has notified anti- dumping duty on hot-rolled and cold-rolled products recently replacing minimum import price (MIP) to address the concerns of the primary steel producers. However, despite these measures, poor demand has been weighing on the prices for last few months.
“We believe, sustainable demand growth is eminent for price recovery and so a good monsoon and 7th pay commission may help in this regard,” said the brokerage.