Construction Industry News
According to a report by ICRA, India’s domestic steel consumption is expected to grow by 9-10% in FY2025. The first quarter of FY2025 saw a 15% YoY growth in demand, though a slowdown is expected in the current quarter due to the impact of the monsoon. ICRA predicts that the steel sector’s capacity utilisation will touch a decadal high of 88% despite the addition of 15.6 million tonnes per annum (mtpa) of new capacity this year.
Between FY2021 and FY2024, the Indian steel industry expanded rapidly, with a capacity addition of 26.3 mtpa. An additional 27.5 mtpa is expected between FY2025 and FY2027, driven by growing demand and increased imports. Finished steel imports from India increased by 35.4% in Q1 FY2025, continuing the trend of the previous year.
Despite rising imports, steelmakers are benefiting from lower raw material costs, with Australian coking coal prices down 45% and NMDC cutting iron ore prices by 18%. These cuts are expected to support profitability, although there may be temporary margin compression in Q2 FY2025.
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