India is a leading exporter of iron ore fines and lump to China and it increased by over 86 per cent in 2019 to 18.35 million tonnes. China’s import of Indian ores also more than doubled to 15.75 MT.
The spread of coronavirus and lockdowns around the world have reversed some of the trends as Indian steelmakers started shipping steel to the world’s largest steel making country – China. JSW Steel and Jindal Steel and Power have sent their shipments to China as most of the steel mills there are yet to start production after the virus pandemic.
India is also a leading exporter of iron ore fines and lump to China and it increased by over 86 per cent in 2019 to 18.35 million tonnes (MT). China’s import of Indian ores also more than doubled to 15.75 MT.
After the lockdown started in the country, production for the domestic market is almost zero for the steel companies. However, they are getting bulk orders from China, Korea, Japan, Middle East and Europe. JSW Steel has operated their steel plants at 38 per cent capacity in April, as most of the products went for export, in addition to the previous orders, said sources in the know.
Indian steel exports exceeded imports by 18 per cent in FY20, registering strong growth after a slow start. The country had imported excessively in FY15 and FY16, before turning net exporter in the next two years. In FY19, the imports rose again because of the shortage.
The slow resumption of steel production in China and other countries may turn out to be a blessing in disguise for the Indian steel industry in the first two quarters. “The export orders will help us to meet the fixed costs,” said a senior executive of an Indian steel maker. The Indian companies have also increased their exports to Southeast Asia which relies on supplies from China.
Jindal Steel and Power is exporting 80 per cent of its steel production, and a majority of this is going to China. The reason is that China has restarted their infrastructure projects, but the raw materials and basic metals are unavailable.
India’s iron ore pellet exports in 2019 increased by around 53 per cent because of the robust demand from China. An accident at Vale’s Feijao iron ore mine in Brazil in January 2019 and following closure of some mines had sharply reduced pellet availability globally, and bolstered demand for Indian pellet. Oman was the second largest importer of Indian pellet in 2019, followed by South Korea, Turkey and Malaysia.
India’s steel consumption has hit the 100 MT mark for the first time in 2019-20, according to provisional data. The import of steel to India was down 13.6 per cent with a huge decline in steel import from China at 22 per cent in FY20. India’s crude steel production was down by 1.5 per cent and finished steel production was flat at 109.2 MT in FY20.