The pressure on domestic stainless steel manufacturers will intensify with imports from China expected to double to 0.25 million tonnes (mt) in 2014, according to the Indian Stainless Steel Development Association.
“We had been tracking the production and supply on a monthly basis, and in July, August and September, the production in China was an average 1.8 mt against a consumption of 1.3 mt,” said NC Mathur, President ISSDA.
Surplus
This results in an average surplus of 0.5 mt a month, which would mean China would have a surplus of 3 mt in (the second half of) 2014, he added.
“Last year, they exported 0.13 mt to India while this is expected to increase to 0.25 mt.” Domestic stainless steel manufacturers have an installed capacity of 5 mt a year, but are operating at less than 50 per cent capacity, producing only about 2.7 mt a year. Demand for stainless steel in India is around 2.4 mt.
Looking forward
“All we are asking for is a level-playing field. The Government can either increase the import duty on finished stainless steel products to 12.5 per cent from 7.5 per cent currently or reduce the import duty on our raw materials to zero from 2.5 per cent now,” said Mathur. He added the Government’s Make in India campaign and plans to build smart cities could lead to additional demand for stainless steel.
“Although we are among the top markets for stainless steel globally, our per capita consumption is still 2 kg against a world average of 6 kg. There is a lot of scope for increasing the per capita consumption.”
Source: The Hindu Businessn Line
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