COVID-19 pandemic has crippled demand in major steel-consuming sectors and impacted steel production globally. In India, steel production slumped in April and May due to lockdown, but there were signs of revival in June. Story: Shivani SharmaDesign: Pragati Srivastava
Global steel output dropped for the third straight month in May 2020 by 8.7 per cent to 148.8 mt as compared with 163 mt in May 2019. China, world's largest producer and consumer of steel reported 4.2 per cent rise in steel output to 92.3 mt in May 2020 as compared to May 2019. Steel production in the rest of the world (excluding China) fell by a sharp 24.1 per cent to 56.5 mt.
Domestic steel production which had fallen to record low levels in April due to the lockdown has shown recovery since then, with the gradual reopening of the economy. Production of crude steel improved from 3.2 million tonnes (mt) in April 2020 to 5.8 mt in May and 6.8 mt in June 2020.
Finished steel production also improved from 1.6 mt in April 2020 to 5.1 mt in May and 5.9 mt in June 2020. It had fallen drastically by 81 per cent in April.
Finished steel consumption jumped 304 per cent in May 2020 over April 2020 and continued to show improvement in June 2020. However, compared to year ago levels, consumption was still down sharply by 40.8 per cent in June 2020.
Increased domestic supply of steel has led to fall in imports and a surge in exports. India exported 1.3 mt and 1.5 mt of finished steel in May and June 2020, respectively, up from 0.4 mt in April 2020.
Imports, on the other hand, fell sharply from 0.4 mt in April 2020 to 0.2 mt in June 2020. India remained a net exporter of finished steel during June with a net trade surplus of 1.3 mt.