Regarding the price of steel, rating agency Crisil on Wednesday cautioned that if the proposed safeguard duty on steel imports is implemented by the end of February, then there may be a huge increase in the price of steel in the year 2025. The price of steel may become costlier by 4-6 percent compared to last year. According to PTI news, CRISIL says that mills are increasing the production volume with new operational capacity, hence the increase in supply will reduce the prices of flat steel but it will be higher than the average price of 2024.
The price was reduced last year
According to the news, Vishal Singh, Director-Research, CRISIL Market Intelligence and Analytics, said that last year, steel prices in the domestic market had declined due to excess availability of the metal due to increase in net imports. Hot-rolled coil (HRC) prices declined by nine per cent and cold-rolled coil prices by seven per cent, slowing topline growth of domestic mills. However, falling coking coal prices and low volatility have helped domestic steel producers ease margin pressure to some extent.
Domestic steel demand will remain ahead in the current year
Australia-origin spot coking coal prices for premium low-volatility grades are expected to decline 12 per cent in 2024, while iron ore prices are projected to rise 9-10 per cent during the period. Notably, China HRC export prices are expected to decline by 12 percent in 2024 and are still trading at a discount to domestic mill prices. CRISIL said domestic steel demand will continue to outpace other major steel consuming economies in the current year due to a shift towards steel-intensive manufacturing in the housing and infrastructure sectors as well as better demand from engineering, packaging and other sectors. 8 There will be an increase of -9 percent. Global steel demand is projected to decline by one percent in 2024.
Demand for steel from Europe, Japan and America
A decline of 3.5 percent was seen in demand in China. China is the world’s largest steel producer and consumer. The agency said there was also an estimated decline of 2-3 percent in steel demand from Europe, Japan and the US. However, demand growth in developing economies such as India and Brazil prevented a sharp decline in global demand. The agency said demand is expected to grow by 11 percent in India, 5.6 percent in Brazil and 2.7 percent in other steel consuming economies.
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