By and large, the global steel sector expected this development from the country that is currently the world’s fourth largest steel producer. According to a new report from the World Steel Association (WSA), India’s steel production has increased 3 percent to 59.62 million tons (MT) thus far in 2013. In the same 9-month period last year, production had been pegged at 57.90 MT.
The country with the fastest growth in steel production, China, had recorded an 8 percent growth at 587.38 MT, despite today’s turbulent times.
For India, the WSA report’s silver lining was that although Japan and the USA, at 82.43 MT and 65.24 MT respectively, produced more steel between January-September 2013, their growth pace was slower than India’s. While the Japanese clocked a 1.4 percent rate of growth, the US experienced a negative 4 percent growth during the same period.
That said, the WSA report has hardly sent the Indian steel sector into raptures. The Indian government acknowledges the possibility of a massive slowdown in India’s steel consumption.
The Joint Plant Committee (JPC), a steel ministry body, had earlier reported that India’s steel consumption grew by a mere 0.3 percent in the first five months of the current fiscal year, at 30.345 MT. Consumption of steel within the country also reached a five-year low. Last year, the country’s steel consumption had gone up by just 3.3 percent, the lowest in the last three years. In 2011-12, the increase was 5.5 percent, and in 2010-11, it was up by 9.9 percent.
For Indian steelmakers, what’s more worrisome is the fine print in the WSA report. India’s September production figures fell way back from global production levels. Whereas the global output of steel grew 6.1 percent, India’s increased at a considerably slower 4.7 percent.
According to the WSA, India’s steel output grew to 6.54 MT in September from 6.24 MT during the same month last year. In the rest of the world, steel output grew to 132.54 MT in September, from 124.93 MT in 2012.
The WSA has already revised its steel consumption growth projection to 3.4 percent for the entire year, from the earlier estimate of 5.9 percent.