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Indian Steel Market Performance Report – April-March, FY’17 Steel production, consumption & export step up

India’s steel market, during FY 2016-17 (FY’17), perked up in its overall performance. The Indian steel industry comprises of some of the top steel companies of the nation like, Steel Authority of India Limited (SAIL), Rashtriya Ispat Nigam Limited (RINL), Tata Steel Limited (TSL), Jindal Steel & Power Limited (JSPL), Essar Steel Limited, and JSW Steel Limited, who are the key integrated steel producers or ISPs, contributing significantly to the country’s overall steel output throughout the fiscal. The rest are contributed by the mini and other producers.

This article provides a thorough analysis of the Indian steel market during the entire 2016-17 fiscal i.e. specifically from April to March in FY’17.   

Performance of the Indian steel market during April-March in FY 2016-17, has been analyzed below in details, with respect to – production, consumption, import, export and stocks.  

Crude Steel 

Total crude steel production from April to March in FY 2016-17 was reported to be 97.443 MT, registering 8.5% growth over April-March, FY 2015-16. Contribution from the ISPs during the period was estimated at 55.122 MT of crude steel, rising by 16.2% while the mini and other producers, at 42.321 MT, declining by 0.1% since the previous fiscal. Among the ISPs, JSW Steel exceled in crude steel production.   

Hot Metal

Production of hot metal during April-March, FY’17 amounted to 64.585 MT, a 10% growth from the same period, in FY’16. Out of this, ISPs’ share stood at 53.103 MT, rising by 12.6% over the previous fiscal while the rest 11.482 MT was the share of mini and other producers, falling by 0.6%. 

Pig Iron

Pig iron production from April to March totaled to 9.968 MT in FY’17, declining by 2.7% from the corresponding period in FY’16. The ISPs came up with  0.852 MT of pig iron production, topped by SAIL. The mini and other producers, on the other hand, reported a production of 9.116 MT of pig iron. Production of pig iron for sale (led by other producers) during April-March period in FY’17 was reported to be 9.391 MT, a 1.8% rise over the same period, last fiscal. Consumption of pig iron during the period under analysis closed at 9.042 MT, up by 0.2% over April-March, FY’16. Pig iron imports during April-March, FY’17 was estimated at 34,000 Tonnes while exports at 387,000 Tonnes, both being negligible. Pig iron stock, as on 31st March 2017 stood at 0.137 MT. 

Sponge Iron (DRI)

Total output of sponge iron during April-March, FY’17 stood at 24.392 MT, increasing by 8.8% from April-March, FY’16. The ISPs reported a share of 7.305 MT, led by Essar Steel. The share of the mini and other producers was 17.087 MT. Sponge iron production for sale from April to March in FY’17 closed at 14.830 MT (reported after domestic consumption), rising by 2.1% over the same period in previous fiscal. Production for sale was mainly led by other producers. The total sponge iron consumed during the period under analysis was reported to be 14.752 MT, up by 4.5% rise over April-March in last fiscal. Import and export of sponge iron during the period was estimated at 1,000 Tonnes (same as April-February FY’17) and 130,000 Tonnes, respectively. Stock of sponge iron, as on 31st March 2017, was estimated at 0.429 MT.   

Semis

Production of semis from April to March in FY’17 summed up to 71.395 MT. The ISPs’ contribution, out of this, has been 29.074 MT, exceled by JSW Steel. The mini and other producers contributed 42.321 MT of semis. Production of semis for sale stood at 38.236 MT, a 3.87% growth over the same period in FY’16. Total semis consumed during the period was estimated to be 37.948 MT, up by 2.7% from April-March, FY’16. During April-March in FY’17, 732,000 Tonnes of semis were imported and 1066,000 Tonnes of semis exported. Semis stock, as on 31st March 2017, stood at 0.515 MT.     

Bars & Rods

Total bars & rods production during April-March, FY’17 closed at 35.004 MT, out of which, the share of the ISPs’ was recorded at 11.549 MT, topped by Tata Steel, and that of the mini and other producers’, at 23.495 MT. Bars & rods production for sale during April-March, FY’17 was estimated to be 34.930 MT, rising by 4.23% from April-March, FY’16. During the period under analysis, 34.673 MT of bars & rods were consumed, registering 5.1 per cent growth over April-March, FY’16. Imports and exports of bars & rods during April-March in FY’17 were reported to be 419,000 Tonnes and 629,000 Tonnes, respectively. Stock, as on 31st March 2017, was estimated at 2.659 MT.  

Structurals

Structurals production during April-March period in FY’17 amounted to 7.850 MT – an amount same as that of production for sale (up by 5.22% over April-March, FY’16). The ISPs came up with a share of 1.617 MT of structurals, led by SAIL, while the mini and other producers’, 6.233 MT of structurals. Total consumption of structurals during FY 2016-17 stood at 7.666 MT, increasing by 4.3% over FY 2015-16. During the period, 64,000 Tonnes of structurals were imported and 161,000 Tonnes exported. Structurals stock, as on 31st March 2017, was recorded at 0.373 MT.   

Railway Materials

Production of railway materials during April-March, FY’17 totaled to 1.056 MT. Out of this, the contribution from the ISPs, who mainly led the production, has been 1.053 MT, exceled by SAIL, while that from the mini and others, 0.003 MT of railway materials (same as 2016-17 during April-February, FY’17). Production of railway materials during FY 2016-17 also stood at 1.056 MT, up by 12.74% over FY 2015-16. During the entire fiscal, 1.032 MT of railway materials were consumed, which is a 13% rise over April-March, FY’16. Railway materials imports during April-March, FY’17 closed at 39,000 Tonnes (same as that during April-February, FY’17), while exports, at 83,000 Tonnes. Stock of railway materials was estimated at 0.056 MT, as on 31st March 2017.     

Plates

Total output of plates during April-March period in FY’17 was reported to be 4.620 MT. The ISPs came up with 4.205 MT (topped by SAIL) of plates, while the mini and other producers, with 0.415 MT of plates. Production of plates for sale during the period under analysis stood at 4.529 MT, increasing by 9.4% over April-March, FY’16. Total consumption of plates during April-March in FY’17 stood at 4.977 MT, rising by 2.1% over the same period, in FY’16. Imports and exports of plates from April to March in FY’17 closed at 740,000 Tonnes and 301,000 Tonnes, respectively. Plates stock, as on 31st March FY’17, stood at 0.336 MT.

HR Coils/Skelp

HR coils/skelp production during April-March, FY’17 summed up to 30.863 MT. The ISPs, out of this, reported a share of 26.784  MT (topped by JSW Steel) and the mini and other producers, 4.079 MT. Production of HR coils/skelp for sale during April-March period in FY’17 totaled to 24.062 MT, a 23.7% growth over the same period, in FY’16. During the entire fiscal 2016-17, 13.966 MT of HR coils/skelp were consumed, up by 9.8% over April-March, FY’16. Imports of HR coils/skelp during the period under analysis were recorded at 1905,000 Tonnes while exports, at 2872,000 Tonnes. Stock of HR coils/skelp, as on 31st March 2017, was estimated at 1.024 MT.   

HR Sheets

Total production of HR sheets was recorded at 1.089 MT during April-March in FY’17. Out of this, the ISPs came up with a share of 1.042 MT, while the mini and other producers, with 0.047 MT. JSW Steel reported the highest production of HR sheets. HR sheets production for sale, during the period, also stood at 1.089 MT, down by 28.2% since the same period, in FY’16. The period April-March, FY’17 witnessed 1.053 MT of HR sheets consumption, which is a 27.1% fall since the corresponding period in FY’16. HR sheets imports and exports during the entire fiscal 2016-17
were reported to be 39,000 Tonnes and 78,000 Tonnes, respectively. HR sheets stock, as on 31st March 2017, stood at 0.175 MT.

CR Sheets/Coils

Output of CR sheets/coils during April-March period in FY’17 amounted to 11.168 MT. The ISPs reported 6.124 MT production, led by JSW Steel while production from the mini and other producers were estimated to be 5.044 MT of CR sheets/coils. Production of CR sheets/coils for sale closed at 8.208 MT, rising by 39.8% from April-March, FY’16. CR sheets & coils consumption during the period under analysis stood at 3.972 MT, up by 2.1% over April-March in the previous fiscal. During April-March, FY’17, 917,000 Tonnes of CR sheets/coils were imported and 1394,000 Tonnes exported. Stock of CR sheets/coils, as on 31st March 2017, was recorded at 0.288 MT. 

GP/GC Sheets

Production of GP/GC sheets during April-March, FY’17 totaled to 7.334 MT, where the ISPs came up with 3.517 MT while the mini & other producers, with 3.817 MT of GP/GC sheets production. Among the ISPs, JSW Steel exceled in GP/GC sheets production. Production for sale, estimated to be same as that of the total production, registered 2.1% growth over the corresponding period in the previous fiscal. During April-March in FY’17, 566,000 Tonnes of GP/GC sheets were imported and 1716,000 Tonnes, exported. Total consumption of GP/GC sheets from April to March in FY’17 stood at 6.624 MT, growing by 0.9% over the same period in FY’16. GP/GC sheets stock, as on 31st March 2017, was estimated at 0.424 MT.  

Electrical Sheets

Electrical sheets production during April-March in FY’17 summed up to 0.213 MT, out of which, the ISPs’ contribution was reported to be 0.156 MT, topped by JSW Steel and the mini and other producers’, 0.057 MT. Production of electrical sheets for sale during FY 2016-17 also closed at 0.213 MT. Electrical sheets consumption during the period under analysis stood at 0.465 MT, rising by 5% over the same period, in FY’16. Electrical sheets imports and exports, during April-March period in FY’17 were estimated at 297,000 Tonnes and 45,000 Tonnes, respectively. Stock of electrical sheets, as on 31st March 2017, stood at 0.011 MT.  

Tin Plates

Total production of tin plates during April-March in FY’17 was recorded at 0.351 MT. Contribution from the ISPs were reported to be 0.030 MT, solely contributed by JSW Steel, while from the mini and other producers to be 0.321 MT of tin plates. Tin plates production for sale, which is equal to the total production, was led solely by the other producers. During April-March, FY’17, 0.544 MT of tin plates were consumed, which is a 22.2% growth over the corresponding period in FY’16. Imports and exports of tin plates during April-March, FY’17 stood at 249,000 Tonnes and 56,000 Tonnes, respectively. No stock of tin plates was reported during the period.  

Pipes (Large Dia.)

Output of pipes during the entire FY 2016-17 totaled to 2.055 MT. The ISPs’ share, out of this, stood at 0.188 MT, topped by Essar Steel while, from the mini and other producers’, at 1.867 MT. Production for sale during the period was also reported at 2.055 MT, down by 5% since April-March, FY’16. Consumption of pipes during the period under analysis was estimated at 1.906 MT. During April-March, FY’17, 101,000 Tonnes of pipes were imported and 247,000 Tonnes exported. Pipes stock, as on 31st March 2017, was recorded at 0.025 MT.

Total Finished Steel – Non-Alloy & Alloy

Total finished steel production reached 110.739 MT during April-March in FY’17. Out of this, the ISPs reported a share of 57.006 MT while the mini and other producers contributed 53.733 MT of total finished steel. JSW Steel registered the highest production of finished steel among the ISPs. Total finished steel production for sale during the entire FY 2016-17 was recorded at 100.742 MT, up by 10.7% over April-March in FY’16. Out of this, the non-alloy steel segment reported a production of 91.678 MT of steel while the rest, i.e. the alloy steel segment (including stainless steel), produced 9.065 MT of finished steel. During the entire FY’17, 83.651 MT of finished steel was consumed, which is a 2.6% growth over April-March in FY’16. 

Import and export of total finished steel during April-March in FY’17 stood at 7.227 MT and 8.245 MT, respectively. Imports were found to have declined by 38.3% since the corresponding period in FY’16 while exports grew by 102.1% over April-March, FY’16. The decline in imports can mainly be attributed to the non-alloy steel segment, whose share was reported to be 5.366 MT (38.4% decline). The share of the non-alloy steel segment in case of exports was estimated at 7.587 MT (118.3% growth). During the entire 2016-17 fiscal i.e., April-March, FY’17, India was the net exporter of steel. Stock of total finished steel, as on 31st March 2017, was recorded at 5.612 MT.

Commodity-wise production trend in March’17

Crude Steel

Crude steel production in March 2017 was up from March 2016 as well as from February 2017 by 0.2% and 2.7%, respectively. Out of the total 8.332 MT of crude steel produced in March 2017, the ISPs contributed 5.101 MT of crude steel, rising by 11.1% over March’16 and 11.9% from February’17. Contribution from the mini and other steel players closed at 3.231 MT of crude steel, falling by 13.3% and 9.1% since March 2016 and February 2017, respectively. 

Hot Metal

Output of hot metal during March 2017 was also reported to have registered growth over March 2016 (by 5.8%) and over February 2017 (by 9.6%). Production in March’17 was recorded at 5.719 MT. The ISPs reported a share of 4.755 MT of hot metal, rising by 8.7% over March’16 and by 11.3% over February’17. The rest, i.e. 0.964 MT, produced by the mini and other steel players, has been a 6.7% decline since March 2016 and 1.8% growth over February 2017.

Pig Iron

Production of pig iron during March 2017 closed at 0.822 MT, falling by 9.2% since March 2016 and increasing by 1.1% from February 2017. Pig iron production for sale was estimated at 0.772 MT during March 2017, up by 4.3% over March 2016 and by 0.9% over February 2017 (after accounting for domestic consumption/IPT).

Sponge Iron

Sponge iron output during March’17 stood at 2.038 MT, up by 5% over March’16 and by 1.5% over Februaury’17. Production of sponge iron for sale in March 2017 was reported at 1.291 MT, growing by 25.3% over March 2016, and by 12.4% over February 2017, after accounting for domestic consumption/IPT. 

Conclusive remarks – steel market performance track on the rise

The performance track of Indian steel market during the entire fiscal 2016-17 and more specifically, during April-March, FY’17 was seen to be on the rise. Both, crude steel as well as total finished steel, the two key sectors of the industry, registered growth in their production from the previous fiscal. JSW Steel outperformed the other ISPs in total finished steel output in FY 2016-17. Another optimistic side of the domestic steel market during FY’17 has been the total finished steel consumption, which boosted up from FY’16. This is a positive indication of a growing demand of steel in the country. However, the most buoyant aspect of FY 2016-17 domestic steel market has been a rise in exports and fall in imports which finally marked India as the net exporter of steel. This itself indicates that India’s steel market treaded a rising track during April-March in FY 2016-17.