Indian steel demand is expected to plunge
to multi-year lows in 2020, hit by slowdowns in the construction, automotive
and rail sectors as India fights the coronavirus with a protracted lockdown, a
leading industry body said.
Steel demand in India is set to contract
7.7% in 2020 with “significant downside risks”, the Indian Steel Association
(ISA), which represents some of the top steel producers, said in a note.
“ISA
had estimated in February that the steel demand in calendar year 2020 would
grow by 5.1% to touch 106.7 million tonnes. We have now revised the steel
demand forecast to 93.7 million tonnes,” it said.
Indian Prime Minister Narendra Modi has
extended the nationwide lockdown until May 3, but the federal government has
allowed states to restart some activity amid economic distress in rural areas.
The coronavirus outbreak has left the
Indian automotive industry in distress, with automakers seeking temporary tax
cuts on cars, trucks and motorbikes as well as incentives to scrap old
vehicles.
The lockdown’s impact on economic
activity will dent steel demand by nearly 13 million tonnes, Arnab Kumar Hazra,
Assistant Secretary-General at the Indian Steel Association, told Reuters,
adding that demand growth is at a multi-year low.
Most steel companies have faced
disruptions and suspended operations at some of their plants.
JSW Steel Ltd, which has the biggest
capacity in India, this week said it was evaluating a phased restart to
operations.
Late last month Steel Authority of India
Ltd, the country’s largest state-owned steelmaker, said some customers had
cancelled orders because of port disruption as the lockdown hobbles movement of
goods.
Source: mining.com