India

The domestic stainless steel market remains resilient, with stable demand coming from the mills.

The Ministry of Steel has recently granted a temporary exemption (until October 26 this year) from Quality Control Order compliance for selected stainless steel flat products, offering relief to MSME (micro, small and medium enterprises) which are facing raw material procurement challenges. These smaller-scale enterprises can now freely import stainless steel grades which are hard to procure via domestic mills, prominently 200 series products catering to utensil and kitchen appliance manufacturers as well as downstream processors.

There is likely to be no major impact on 300 and 400 series grades, but domestic mills making 200 series products will face more competition. Imports of stainless steel, especially 200 series, will continue to gain traction as a result of the above.

Shyam Metalics and Energy, an established name in steel production, has recently launched a specialised stainless steel vertical, Tiger Stainless. With an integrated melting and rolling capacity of 200,000 tonnes per annum, it is equipped with Danieli rolling mills and dedicated bar and wire lines.

The investment is expected to total at least US$ 285 million, with approximately US$ 190 million going towards boosting speciality and stainless steel capacity by 2029 and some US$ 95 million earmarked for special bar quality mills. Production will cover austenitic, ferritic, martensitic, duplex and super duplex grades targeting high corrosion and high performance applications.

Meanwhile, there has been a noticeable shift in strategy among mills to try and source domestic stainless steel scrap to the best extent possible - driven by immediate delivery, credit payment terms and more control over quality. In recent weeks, an LME price surge and supply crunch have helped to raise prices for both imported and domestic stainless steel scrap. However, scrap import prices are being stemmed by the depreciation of the Indian rupee.

Mills are constantly aiming to stock raw materials strictly in line with their order books. High levels of LME volatility, coupled with the very volatile Indian rupee, is prompting mills to be cautious and to take long-term calls on raw material stocking. As a result, there is good variation in the raw material prices given by the various mills at any point in time, driven by their requirements for each specific grade. Driven by limited margins, mills are taking care to bid aggressively only on the grades which they need.