India

The new government is in place and the decision-making process has begun, but finished product demand and pricing have yet to experience an encouraging lift.

According to a recent report, overall steel demand in India is expected to expand at a compound annual growth rate of 5% to 7.3% over the next decade to reach between 220 and 275 million tonnes per annum by the 2034 financial year, driven by the Indian government’s infrastructure push. The country is on track to develop 11 industrial corridors comprising 32 projects in four phases under Prime Minister Gati Shakti and this national master plan is likely to be the key driver for steel consumption.

Indian mills have remained cautious rather than aggressive in their procurement of imported stainless scrap at a time when domestic availability has been steady. Mills’ scrap inventories are not huge and are driven by constant pressure on finished prices. The three-pronged strategy adopted by mills to optimize operations involves: a focus on sourcing scrap within India; cautious buying of imported scrap and only at workable prices; and tight inventory control, ensuring no large volumes in the pipeline.

In contrast, prices in Europe, the USA and the Far East have been better.

The biggest recent development has been the huge spike in container freight rates across the globe. The impact is more pronounced on Far East-India routes but significant increases have also been seen from Europe and the USA. Imports and exports into India have been duly affected, with the impact on stainless scrap being severe as it is imported mostly in containers. The market is looking for a softening in ocean freights and some movement in finished product prices to restore lost momentum.