September 08, 2008

India becomes 5th largest crude steel producer in the world

India’ steel ministry announced that “Led by robust domestic demand the steel sector in India has been witnessing extraordinary growth, making India the 5th largest crude steel producer in the world as against 8th position held 3 years back.”

It added that “Production of finished carbon has increased from 35.41 million tonnes in 2002-03 to 49.58 million tonnes in 2006 -07. During April to October 2007, production of finished carbon is estimated to be about 29.37 million tonnes and is expected to be 55.5 million tonnes in 2008.”

While exports have remained fairly stable between 2002 and 2003 until last year at around 4.5 million tonnes, imports have increased from 1.51 million tonnes in 2002-03 to 4.10 million tonnes maintaining a rising trend this year, largely to fill the demand supply gap in the domestic market.

The demand for steel is expected to remain buoyant, above 10% over the next 5 years and in the most likely scenario the steel production capacity in India is expected to touch 124 million tonnes by 2012. While the Brownfield expansion plan over the next 5 years is expected to add 40.5 million tonnes capacity to the existing capacity of 56.84 million tonnes, the most likely scenario for addition to capacity by setting up of Greenfield projects is expected to be 28.72 million tonnes taking the total capacity to 124.06 million tonnes.

As per a steel ministry release “Taking into consideration the intentions expressed by various steel investors including multinationals, domestic steel majors and FDI, the likely capacity achievable by 2019-20 will be around 275 million tonnes.”