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A Review of developments in
The Global & Indian Steel Industry
Monthly edition
Issue No. 39
June 2019 (Covering May 2019)
Compiled on behalf of Indian Steel Association,
By Mr. Anup Kashyap,
Senior Executive-Technical
Strictly for Internal circulation
About the Report
❑ The Indian Steel Association introduced a monthly report titled ‘A REVIEW
OF DEVELOPMENTS IN GLOBAL & INDIAN STEEL INDUSTRY’, from August
2016.
❑ The report provides general background information reviewing the status
of the developments in the global and Indian steel industry, pertaining to
raw material, production & consumption, trade, shipping, pricing &
forecasts, country reportage, policy developments, economic parameters
etc.
❑ The consistent format of the report provides an insight into the relevant
aspects of steel scenario globally and domestically .
❑ The information has been sourced from independent third party databases,
knowledge sources and news reports, and the authenticity of the same has
not been independently verified by ISA.
❑ The report is issued in the last week of each month to the members of
Indian Steel Association , various ministries / departments / institutions.
Contents of the Report
SI.
No
Title Page
Number
1. Global Economic Development 4-6
2. Global Steel Development 7-13
3. Domestic Steel Development 14-18
4. Indian Economic Development 19-21
5. About ISA 22-28
GLOBAL ECONOMIC DEVELOPMENTS
4
Source: Global Forecasting Service
Country-wise Growth Forecasts
2019 - 2023
As of June 19th 2019.
The assumptions for forecasts are available on the website of the Economist Intelligence Unit
In % 2019 2020 2021 2022 2023
India
Real GDP Growth 6.9 7.1 7.3 7.3 7.1
Inflation 3.7 4.4 3.9 4.4 4.1
China
Real GDP Growth 6.3 6.1 5.6 5.2 5.0
Inflation 2.9 3.1 2.7 2.9 2.7
U.S.A
Real GDP Growth 2.2 1.7 1.8 2.0 1.7
Inflation 2.2 1.4 2.2 2.1 1.8
Japan
Real GDP Growth 1.0 0.4 1.1 1.2 1.1
Inflation 1.1 1.5 0.9 1.1 1.3
EU 28
Real GDP Growth 1.4 1.5 1.7 1.8 1.8
Inflation 1.6 1.7 1.9 2.0 1.9
5
Source: OECD report on Global Scenario-May 2019 6
Country Wise Economic Outlook
❑ China - Growth is projected to decline gradually in 2019-20 as the economy continues to rebalance. Signs of the
slowdown include the weakening of private investment, in particular real estate investment. Business investment
remains stable, in particular in services, as the economy continues to rebalance. Real estate investment, in contrast,
remains weak, with new residential housing starts plummeting. Trade has weakened as the frontloading of exports has
ended and the imports of capital goods have slowed amid rebalancing and gradual moving up the value chain. As
tourism imports have remained robust, the current account surplus has declined.
❑ United States - Economic growth is slowing as fiscal policy becomes less supportive, and headwinds from a weaker
global outlook, as well as trade and political uncertainties, weigh on activity. The labour market remains strong and,
while job growth will slow, wages are picking up, which will underpin continued consumption growth. Uncertainty
about trade policy and the consequences of past trade measures, coupled with the current weakness in global
demand, are damping exports and investment.
❑ Japan - After peaking at 1.9% in 2017, economic growth slowed to 0.8% in 2018, reflecting weaker export momentum
as world trade decelerated. Nevertheless, the current expansion, which began in late 2012, is now the longest in
Japan’s post-war history, supported by a moderate recovery of consumption and robust business investment. The
expansion faltered in early 2019, with declines in industrial production and exports, though labour market conditions
remain tight.
❑ India- India has the fastest growth among G20 economies. Export growth has held up well, with export orders
growing steadily. The Goods and Services Tax (GST) administration has continued to improve, enabling exporters to
get faster tax refunds, and ongoing efforts to improve trade infrastructure, logistics and processes are starting to pay
off. Investment has continued to grow robustly, supported by hefty public sector projects. In contrast, private
investment, in particular in manufacturing, has been affected by uncertainty ahead of the parliamentary elections,
combined with persistent difficulties in financing projects, acquiring land and getting all the necessary clearances. Rural
consumption, two-wheeler and tractor sales have slowed, driven by subdued agricultural prices and wages.
GLOBAL STEEL DEVELOPMENTS
7
Source: World Steel Association
Global Crude Steel Production
➢ World crude steel production for the 64 countries reporting to the World Steel
Association (world steel) was 162.7 million tonnes (Mt) in May 2019, a 5.4% increase
compared to May 2018.
➢ China’s crude steel production for May 2019 was 89.1 Mt, an increase of 10.0% compared
to May 2018.
➢ India produced 9.2 Mt of crude steel in May 2019, up 5.1% on May 2018. Japan produced
8.7 Mt of crude steel in May 2019, down 4.6% on May 2018.
➢ South Korea’s crude steel production stood at 6.4 Mt, up 2.2% on May 2018.
➢ In the EU, Italy’s crude steel production for May 2019 was 2.2 Mt, up by 1.1% on May 2018.
France produced 1.2 Mt of crude steel in May 2019, a decrease of 7.6% compared to May
2018. Spain produced 1.3 Mt of crude steel in May 2019, down by 7.1% on May 2018.
➢ The US produced 7.7 Mt of crude steel in May 2019, a 5.4% increase on May 2018.
➢ Brazil’s crude steel production for May 2019 was 2.8 Mt, up by 2.9% on May 2018.
Source: World Steel Association
Rank Nation Jan-May 2019
(in MT)
Jan-May 2019
(in MT)
% Change
1 China 404.879 367.434 10.2
2 India 45.314 44.811 1.1
3 Japan 42.294 44.217 -4.3
4 USA 37.169 35.002 6.2
5 South Korea 30.486 29.944 1.8
6 Russia 29.760 29.971 -0.7
7 Germany 17.269 18.213 -5.2
8 Turkey 14.297 15.880 -10.0
9 Brazil 14.027 14.244 -1.5
10 Italy 10.427 10.679 -2.0
Top Crude Steel Producing nations
Source: Steel Mint 10
Global HRC price
June 2019
➢ Chinese HRC export offers is showing downward momentum owing to gloomy market
sentiments and dull trades prevailing in domestic market.
➢ Currently China’s HRC export offer declined by USD 10-15 per ton W-o-W basis and
assessed at USD 480-490 per ton FoB basis.
➢ Meanwhile Domestic prices of HRC in China fell significantly by RMB 50-60 per ton.
Global HRC price
Source: Steel Mint 11
Global Ferrous Scrap Market Overview
➢ Global Ferrous scrap prices observed mix trend in June 2019. Turkey has observed
rebound by USD 12-13 per ton in recent deals, following which global offers from US and
European Market likely to revive reflecting in an increase in imported scrap prices in
South Asia and East Asia in upcoming days.
➢ On the other hand ,Still weak US west coast offers and Cheaper Japanese scrap prices
likely to limit the sharp rise further. Tight Supply and Improving profit margins have
resulted in a jump in domestic scrap purchase prices in China
Source: Coal Mint Research 12
➢ Seaborne Metallurgical coal export prices have slid further during June 2019 amid
weakening demand from across the globe in response to the bearish outlook on the
worldwide steel market and subdued buying interest in major steel producing countries.
➢ Chinese domestic coking coal prices have also inched down lately as metallurgical coke
prices came under pressure fromTangshan’s output cut.
Trend in Coking Coal Price
Source:Steel Mint 13
South Korean Steel Export Outlook
➢ South Korea exports billet to Japan increased to 0.02 MT in May 2019 as against 0.01MT
in previous month.
➢ South Korea’s finish long exports increased by 11% to 0.21 MT in May 19 in contrast with
0.19 MT in April 2019.
➢ South Korea finish flat steel export for May 2019 was recorded at 2.03 MT marginally up
by 2% as compared to 2MT in previous month
DOMESTIC STEEL DEVELOPMENTS
14
Source: Joint Plant Committee, Ministry of Steel 15
April – May
2019
April-May
2018
% Change over April
– May ,2018%
Quantity in Million tons
Crude Steel 17.98 17.432 3.1
Finished Steel
Production for Sale 21.91 21.21 3.3
Import 1.12 1.21 -7.6
Export 0.716 1.017 -29.6
Real Consumption 16.33 15.34 6.5
Status of Indian Steel Industry
➢ Production of crude steel was 17.98 MT in April to May 2019 at a growth rate of 3.1 %
➢ Finished steel produced during April to May 2019 was 21.91 MT.
➢ Import of finished steel was 1.12 Mt during April to May 2019 which saw a decline of 7.6 %
➢ Export of finished steel was 0.716 MT and the rate declined to 29.6 % a compared to
previous year during the same time period
➢ Consumption of finished steel was 16.33 MT and saw a growth of 6.5 % as compared to
previous year.
Source: Govt. of Odisha 16
Trend in Iron Ore Production in Odisha
▪ Odisha- India’s largest iron ore producing state recorded a decrease in iron ore production
for the monh of May 2019.Production in May 2019 stood 11.7 MT .Output moved down
by 6% for May 19 as against 12.45 MT in April 19.
▪ The figures includes includes the type of material- Fines, lumps and concentrate.
Source:Steel Mint 17
▪ India finish long steel imports increased by around 36.5 % M-o-M n May 2019.
▪ Finish long steel imports in India recorded at 51.81 MT in May 2019 as compared to 37.94
Mt in April 2019.
▪ The Key factors towards strengthening finish long steel imports in India during May is
competitive landed cost of rebar which contributes the large Volume 27.275 MT. and major
imports registered in South India –Chennai port at 14,160 tons(81.28%) followed by
kattupali port-12,092 tons (+2 %) and in Western region JNPT-7,928 tons (-16%)
Trend in Indian Flat long Steel Imports
Source: Joint Plant Committee 18
Average Domestic Steel Price
INDIAN ECONOMIC DEVELOPMENT
19
Source:Central Statistics Organisation (CSO) 20
Indian Economic Highlights
➢ The growth rate of the Index of Industrial Production (IIP) was up by 3.4% during April
2019 (prov.),encouraged by stable growth in Electricity (6%) and Mining (5.1%) while
Manufacturing reported a growth of 2.8%.
➢ The Use-Based scenario of the Index of Industrial Production (IIP) during April 2019
(prov.) show that all the sectors recorded a growth with Intermediate Goods (1.0%)
reporting the lowest and Primary Goods, the highest (5.2%).
Source: Reserve Bank of India
CurrencyDate
28th June 2019
I USD 68.91
1 EUR 78.35
1 GBP 87.34
100 YEN 63.97
Base Rate : 8.95-9.40%
Savings Deposit Rate : 3.50%
MCLR (Overnight) : 8.05-8.50%
Term Deposit Rate > 1 year : 6.25-7.30%
Policy Repo Rate : 5.75 %
Reverse Repo Rate : 5.50 %
Marginal Standing Facility Rate : 6.00 %
Bank Rate : 6.00 %
CRR : 4%
SLR : 19.00%
Reference Rates
Lending/ Deposit Rates
Reserve RatiosPolicy Rates
Rates at Reserve Bank of India
2019
21
ABOUT ISA
22
About ISA
➢ The Indian Steel Association (ISA) is the voice of the Indian Steel Industry,
in both domestic and global forums. It is at the forefront of all
deliberations pertaining to matters of public & regulatory policy, raw
materials, international trade, logistics, environmental concerns,
technology and other aspects of steel-making. The Indian Steel Industry
looks at ISA to further its critical agenda of sustained growth, both in
steel production and in generating domestic demand.
➢ ISA was formed in 2014 and has 15 members – eight full members and
seven affiliates. The list of full members includes –Steel Authority of India
(SAIL) and Rashtriya Ispat Nigam Ltd (RINL) – while heavyweights from
the private sector include JSW Steel Ltd, Tata Steel Ltd, Jindal Steel and
Power Ltd, Essar Steel India Ltd, Bhushan Power and Steel Ltd and Tata
Steel BSL Ltd. ISA, an affiliate member of World Steel Association (WSA),
regularly collaborates with WSA on the organisation of events, as well as
taking part in other key meetings with global partners.
23
Our eight Full Members are:
• Tata Steel Ltd
• Steel Authority of India Ltd.
• JSW Steel Ltd.
• Rashtriya Ispat Nigam Ltd.
• Essar Steel Ltd.
• Jindal Steel & Power Ltd.
• Tata Steel BSL Ltd.
• Bhushan Power & Steel Ltd.
Our Seven Affiliate Members are Monnet
Ispat & Energy Ltd., INSDAG (Institute
for Steel Development and Growth),
KISMA (Karnataka Iron and Steel
Manufacturer’s Association), Arjas Steel,
Jindal Stainless, Electrosteel Steels and
Orissa Metalliks Pvt. Ltd
Members of Indian Steel Association
24
Vision and Objectives of ISA
➢Vision of ISA-
To work towards transforming the Indian Steel Industry as a
global leader acclaimed for its Quality, Productivity and
Competitiveness, with a focus on health, safety and
environment, along with a growing thrust on innovation through
R&D, adopting an inclusive and collective approach.
➢ Objectives of ISA-
▪ Promoting steel by raising awareness about the numerous
advantages of good quality steel
▪ Collaborating with international steel organizations to
tackle issues of mutual interest.
▪Working with the government on matters affecting the
steel industry.
25
Important Ministries/Department/Organization
Ministry of Steel
Name of the person Designation Contact Details
Shri Binoy Kumar Secretary [email protected]
Shri Saraswati Prasad Special Secretary & Financial Adviser [email protected]
Smt. Rasika Chaube Additional Secretary [email protected]
Smt. Ruchika Chaudhry Govil Joint Secretary [email protected]
Shri Puneet kansal Joint Secretary [email protected]
Ministry of Mines
Name of the person Designation Contact Details
Shri Anil Gopishankar Mukim Secretary [email protected]
Dr. K. Rajeswara Rao Additional secretary [email protected]
Ministry of Commerce
Name of the person Designation Contact Details
Shri Anup Wadhawan Secretary [email protected]
Shri Shudhanshu Pandey Additional Secretary [email protected]
Shri Alok Vardhan Chaturvedi DGFT [email protected]
Dr. K.C.Rout Additional Secretary-DGFT [email protected]
Ministry of Environment, Forest and Climate Change
Name of the person Designation Contact Details
Shri C K Mishra Secretary [email protected]
Control Pollution Central Board
Name of the person Designation Contact Details
Shri S.P. Singh Parihar Chairman [email protected]
Dr. Prashant Gargava Member Secretary [email protected]
Ministry of FinanceName of the person Designation Contact Details
Shri Rajiv Kumar Joint Secretary [email protected]
26
Contact Us for data related issues
Address:207-208, 2nd Floor
Kailash Building
New Delhi -110-001
India
Tel: +011 4266 8811
Fax: +011 4266 8805
E-mail: [email protected]
Website: http://indsteel.org/27
THANK YOU
DISCLAIMER
The material in this presentation has been prepared by Indian Steel Association (ISA) and is a general background information reviewing the
status of the developments in the global and Indian steel industry as at the date of this presentation. This presentation is strictly for internal use
of all the member companies of ISA, whose names have been stated in the presentation.
Information is given in summary form and does not purport to be complete or all inclusive. The information has been sourced from independent
third party databases, knowledge sources and news reports, and the authenticity of the same has not been independently verified by ISA.
Additionally, any third party forecasts on financial or economic parameters, projections or estimates should not be construed as an investment
advice or a recommendation to any ISA member. Recipients of this presentation from member companies of the ISA should each make their own
evaluation of the contents and adequacy of the information contained in the presentation.
ISA does not undertake any obligation to publicly release any changes to any revisions, modifications or forward looking statements in the
subsequent editions of this bi-monthly presentation. Unless otherwise specified, all information is for the period May 2019 or prior.
28
