Indian ferrous scrap imports, despite an early 2025 rebound, are now encountering significant challenges due to the increasing competitiveness of domestically produced Direct Reduced Iron (DRI). While Indian crude steel production continues to grow, up 8.2% year-on-year to 67.2 million tonnes in January-May 2025, the demand for imported scrap remains weak. Steelmakers are increasingly opting for cheaper domestic DRI, which allows them to maintain production levels while controlling input costs. This substitution effect is exerting pressure on scrap imports, even as global and Indian scrap prices have declined. In June 2025, the premium of imported shredded scrap over domestic DRI was $72.10 per tonne, higher than the year-to-date average but below the 2024 average. The long-term outlook for Indian ferrous scrap imports will depend heavily on evolving supply chains and government policy decisions.