Indian traders scoop up cheaper Chinese steel, says industry executives – ET Infra

Indian traders have been scooping up Chinese steel at a deep discount, industry officials and analysts said, spooking Indian producers ahead of a seasonal pick up in domestic demand.

Lured by discounts of $30 to $50 a tonne on hot-rolled and cold-rolled products, Indian buyers are signing a flurry of import deals, they added. Domestic industrial activity is set to pick up over the next two months after the monsoon rains recede.

Indian traders are buying the grades used in automobiles and construction, main drivers of domestic steel demand, the officials and analysts said.

“The Chinese are offering discounts because other markets are not doing well and we are seeing good growth in Indian automobile and construction sectors,” said Snehdeep Bohra, a director at Fitch Ratings in India.

Traders near port cities in the eastern state of Odisha and the western state of Gujarat find it cheaper to import steel from China than spend on local freight, a senior executive at a major Indian steelmaker said on condition of anonymity.

Cheaper steel purchases from China could further eat into the market share of Indian suppliers, already hit by imports of Chinese electrical steel used in power infrastructure and electric motors, industry officials and analysts said.

Senior officials at five big Indian mills, some of whom did not wish to be named as they were not authorised to talk to media, said Chinese imports were a threat.

India, the world’s second-biggest crude steel producer, imported 228,000 metric tons of steel from China during the first two months of the fiscal year that began in April – the highest in six years.

In April-May, Indian imports of Chinese steel products such as plates and pipes used as construction material reached a three-year high.

During April-May, around 35% of steel imports from China were cold-rolled steel products, followed by pipes.

About 68% of Chinese cold-rolled steel cargoes landed at Mundra Port, owned and operated by Gujarat Adani Port.

Stainless steel imports from China reached a three-year high at 107,000 metric tons in the same period.

However, India has decided not to impose a countervailing duty on select steel imports from China to protect end-users, a government source told Reuters last week.

  • Published On Jul 17, 2023 at 05:47 PM IST

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