Integrated steelmakers such as Jindal Steel & Power Ltd (JSPL) turned to exports during the first quarter of 2020, when weak domestic demand coincided with a growing need for steel in regions such as Europe and China.
But over the past month, stronger domestic consumption of flat steel in India and limited hot rolled coil (HRC) supplies, following the reduction in steel output due to Covid-19 restrictions, has led mills to sharply increase their flat steel offer prices for September sales.
Fastmarkets’ weekly price assessment for steel hot-rolled coil domestic, exw India was Rs38,500-39,000 per tonne on August 28, up from Rs35,000-35,500 per tonne one month before.
JSPL's sales rose by 38.0% year on year to 836,000 tonnes in August compared with 606,000 tonnes in August 2019, the company said on Thursday September 3.
Exports contributed 42% to the company’s overall sales volumes last month, down from 57.7% in the second quarter of 2020.
Steel export volumes have come down significantly with an increase in domestic sales following the lockdown period, JSPL managing director VR Sharma said.
The picture was similar for the sate-owned Steel Authority of India (Sail), which sold an overall 1.43 million tonnes of steel in August, up 35.3% from 1.06 million tonnes the same month in 2019, according to a report in Indian newspaper The Hindu.
And while Sail’s exports in August amounted to 109,400 tonnes and accounted for just 13.5% of total sales, this was a 250% year-on-year increase compared with August 2019, which clearly demonstrates the dramatic shift toward export sales that has taken place in India during the Covid-19 outbreak.
One key reason for the rise in domestic demand has been stronger Indian automotive demand during July and August, a major South Asian scrap exporter told Fastmarkets.

Source: Fastmarkets