The Indian credit rating agency ICRA has revised its forecast for domestic steel consumption growth in India to 9-10% for FY2024/2025, up from its previous estimate of 7-8%. This growth is driven by robust demand from various sectors, including government capital expenditure and residential construction.
Domestic steel consumption in India increased by 11.3% between February and April 2024, indicating a stable demand despite elections. ICRA has revised its baseline forecast for average steel prices for FY2024/2025 upwards by 2-3% from its previous estimates, which is expected to result in a $12-18 per tonne increase in profits in the current fiscal year.
India's steel industry has seen its fastest growth period since the global financial crisis over the past three years, with consumption growth of 13.6% in FY2023/2024. The country turned into a net importer of steel in FY2023/2024, and ICRA expects domestic steel imports to grow by around 13-14% in FY2024/2025, leading to the country becoming a net importer of steel in the current fiscal year as well.
