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India Steel Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

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  • 70 Pages
  • April 2023
  • Region: India
  • Mordor Intelligence
  • ID: 5769683
The Indian steel market is anticipated to register a CAGR of greater than 7% during the forecast period. Steel consumption across industries, including automotive and transportation, building and construction, and others, was restricted owing to the pandemic. However, the steel market witnessed a strong recovery with the smooth functioning of the end-user industries in curbing the spread of the virus. Currently, the steel market is recovered from the pandemic and is expanding significantly.

Key Highlights

  • Over the short term, expanding population, urbanization, automobile industry, increased spending on construction and infrastructure projects, and increased steel demand have been projected to drive the market during the forecast period.
  • However, due to instability in raw material prices and high production costs, the profit margin has significantly decreased for steel manufacturers in India. The price fluctuation caused huge losses to importers, which hampered the growth of the Indian steel market.
  • Nevertheless, using hydrogen instead of carbon in steel manufacturing and increasing trade and investment opportunities in the future for the market studied are likely to create lucrative growth over the forecast period.

India Steel Market Trends

Building and Construction Sector Promotes the Demand for Steel

  • Steel is a man-made alloy that falls within the ferrous metal classification. It contains iron (a naturally occurring metal element on earth), carbon, and other components. Construction is a sector where steel is widely used since structures are created using it due to its high durability and strength.
  • According to the Joint Plant Committee (JPC), the building and construction sector contributed to about 40% of India's steel demand as of the financial year 2021.
  • According to the India Brand Equity Foundation (IBEF), India was the world's second-largest producer of crude steel in September 2021, and total crude steel production in FY22 was 120.0 million tons, as compared to FY2021, i.e., 102.5 million tons. Regardless of the simple availability of low-cost labor and the presence of vast iron ore reserves, India is globally competitive. India has the fifth-largest iron ore resource in the world.
  • The government allotted INR 47 crores (USD 6.2 million) to the Ministry of Steel in the Union Budget 2022-23. The overall steel consumption in India is expected to rise to 230 million tons by 2030-31, up from 133.596 million tons in FY22.
  • Steel is commonly used in construction because of its high durability and strength. Steel structures can also withstand natural calamities and be tailored to the needs of a specific project.
  • Government social sector programs such as the Pradhan Mantri Awas Yojna, which promotes housing for all, the Sardar Patel Urban Housing Project, the 100 Smart Cities Mission, and the construction of infrastructure in medium and small towns are promoting the growth of the Indian steel industry.
  • According to the Ministry of Steel, India (MOS) and Joint Plant Committee, India (JPC), in 2021, India's steel consumption volume was anticipated to be around 106 million metric tons. This was a considerable gain over the previous year.
  • The National Bank for Financing Infrastructure and Development (NaBFID) is a USD 2.5 billion development finance organization to fund infrastructure projects in India. It was established by legislation passed by the Parliament in March 2021.
  • Infrastructure activities accounted for 13% of overall FDI inflows in the financial year (FY) 2021. FDI in the construction development sector (townships, housing, built-up infrastructure, and construction development projects) and construction (infrastructure) activities reached USD 28.64 billion and USD 26.22 billion, respectively, between April 2000 and June 2022.
  • All the aforementioned factors are expected to drive the construction and building industry, which is further likely to boost the demand for steel in India during the forecast period.

Automotive Industry also Holds a Significant Share of the Indian Steel Market

  • Over the last two decades, the Indian automotive industry has made remarkable achievements, emerging as one of the world's fastest-expanding marketplaces. Steel is a popular commodity among automakers, accounting for 60-65% of the total raw material contained in an average Indian vehicle. The automotive industry had a ten percent share of the country's steel demand that year.
  • Tata Steel has substantially invested in new facilities, capabilities, and infrastructure in response to the rising needs of car manufacturers. Tata Steel has led the way in the development of specialty automotive goods such as micro-alloyed high-strength steels, Interstitial Free (IF) steel, and Galva Annealed for two-wheeler fuel tanks. It was the first local integrated supplier of Hot Rolled high-strength steels and passenger car exterior body panels.
  • The company hopes to deliver the next generation of advanced high-strength steels (AHSS) to India with the commissioning of JCAPCPL (a joint venture of TSL and NSSMC) and the Kalinganagar facility.
  • According to the Society of Indian Automobile Manufacturers (SIAM), from April 2021 to March 2022, the automobile industry manufactured a total of 22.93 million cars, which included passenger vehicles, commercial vehicles, three-wheelers, two-wheelers, and quadricycles. India has a substantial presence in the international heavy vehicle market since it is the world's largest tractor manufacturer, second-largest bus maker, and third-largest heavy truck manufacturer.
  • According to SIAM, in FY 2022, a total of 3.65 million passenger vehicles were produced across India compared to FY 2021, i.e., 3.06 million. The total number of passenger vehicles sold grew from 2,711,457 to 3,069,499 units in 2021. Passenger car sales fell from 1,541,866 to 1,467,056 units, while utility vehicle sales climbed from 1,060,750 to 1,489,178 units between April 2021 and March 2022. 113,265 vans were sold during the same period, compared to 108,841 vehicles from April 2020 to March 2021.
  • According to SIAM, sales of commercial vehicles grew from 568,559 to 716,566 units, medium and heavy commercial vehicle sales climbed from 160,688 to 240,577 units, while light commercial vehicle sales increased from 407,871 to 475,989 units from April 2021 to March 2022.
  • According to SIAM, passenger vehicle exports increased from 404,397 to 577,875 units from April 2021 to March 2022, commercial vehicle exports increased from 50,334 to 92,297 units, three-wheeler exports increased from 393,001 to 499,730 units, and two-wheeler exports increased from 3,282,786 to 4,443,018 units from April 2021 to March 2022.
  • In FY23, India's passenger vehicle sector is predicted to rise by 16%. The trucking market in India is predicted to more than quadruple by 2050. The number of trucks is predicted to more than quadruple, rising from 4 times in 2022 to almost 17 million by 2050.
  • The automotive industry in India is worth more than USD 222 billion, accounting for 7.1% of India's GDP, and is expected to become the world's third-largest by 2030. The expansion of the automotive industry corridor from Jharkhand to Odisha in East India will contribute to production efficiency and thus support the steel market.
  • All the aforementioned factors are expected to drive the demand for steel in India during the forecast period.

India Steel Industry Overview

The Indian steel market is consolidated in nature. The major manufacturers in the market (in no particular order) include JSW Steel Ltd, Tata Steel Ltd, Steel Authority of India Limited (SAIL), Hindalco Ltd, and Jindal Steel and Power Ltd (JSPL), followed by other prominent players.

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Table of Contents

1.1 Study Assumptions
1.2 Scope of the Study



4.1 Drivers
4.1.1 Rising Urbanization and Increased Spending on Construction and Infrastructure Projects
4.1.2 Increased Demand for Long Steel
4.2 Restraints
4.2.1 High Production Costs
4.2.2 Instability in Raw Material Prices
4.3 Industry Value-Chain Analysis
4.4 Porter's Five Forces Analysis
4.4.1 Bargaining Power of Suppliers
4.4.2 Bargaining Power of Buyers
4.4.3 Threat of New Entrants
4.4.4 Threat of Substitute Products and Services
4.4.5 Degree of Competition

5.1 By Form
5.1.1 Liquid Steel
5.1.2 Crude Steel
5.1.3 Finished Steel
5.2 By Technology
5.2.1 Blast Furnace-Basic Oxygen Furnace (BF-BOF)
5.2.2 Electric Arc Furnace
5.2.3 Other Technologies
5.3 By End-User Industry
5.3.1 Automotive and Transportation
5.3.2 Building and Construction
5.3.3 Tools and Machinery
5.3.4 Consumer Goods
5.3.5 Energy
5.3.6 Other End-user Industries

6.1 Mergers, Acquisitions, Joint Ventures, Collaborations, and Agreements
6.2 Market Ranking Analysis**
6.3 Strategies Adopted by Leading Players
6.4 Company Profiles
6.4.1 APL Apollo Tubes Ltd
6.4.2 Electro Steel Castings Ltd
6.4.3 Godawari Power & Ispat Ltd
6.4.4 Hindalco Ltd
6.4.5 Jayaswal Neco Industries
6.4.6 Jindal Steel and Power Ltd (JSPL)
6.4.7 JSW Steel Ltd.
6.4.8 Maharashtra Seamless Ltd
6.4.9 Mukand Steel
6.4.10 NMDC
6.4.11 Ratnamani Metals & Tubes Ltd
6.4.12 Steel Authority of India Limited (SAIL)
6.4.13 Tata Steel Ltd
6.4.14 Welspun Corp Ltd

7.1 Make Use of Hydrogen Instead of Carbon
7.2 Increasing Trade and Investment Opportunities

Companies Mentioned (Partial List)

A selection of companies mentioned in this report includes, but is not limited to:

  • APL Apollo Tubes Ltd
  • Electro Steel Castings Ltd
  • Godawari Power & Ispat Ltd
  • Hindalco Ltd
  • Jayaswal Neco Industries
  • Jindal Steel and Power Ltd (JSPL)
  • JSW Steel Ltd.
  • Maharashtra Seamless Ltd
  • Mukand Steel
  • NMDC
  • Ratnamani Metals & Tubes Ltd
  • Steel Authority of India Limited (SAIL)
  • Tata Steel Ltd
  • Welspun Corp Ltd