India steel output to grow by 7% in 2016: Platts

Steel production in the country will continue to grow by almost 7 per cent in 2016, according to Platts.
The statement comes in the wake of latest data by World Steel Association (WSA) which shows India is the only country among major steel producing nations such as China, Japan, South Korea and the US, that witnessed growth in production in 2015.
Production in the world's third largest steel producer -- India -- rose by 2.6 per cent to 89.6 million tonnes (MT) in 2015 as against 87.3 MT in 2014, according to WSA data.
"In 2015, out of the 10 largest steel production countries in the world, nine saw production cuts, the exception was India. In 2016, we continue to see Indian steel production growing by almost 7 per cent," Editor-in-Chief, Platts Steel Business Briefing, Henry Cooke said today.

Platts sees long desired and much needed new investments in infrastructure projects such as roads, railways, ports, power and water infrastructure are a key driver for steel consumption.
The consumption of steel per head of population in India is extremely low.

"The consumption of steel per head in India is around 65 kg per year against 235 kg as a global average," Cooke said.
While growth of 7 per cent in Indian steel production is impressive in the current environment, it is hardly comparable to the booming steel production that China underwent over the last 20 years, he added.
As per Steel Ministry also, India is the only country among major steel producing countries which recorded a positive trend in steel production and consumption last year.

"India became the third largest producer of steel in the world in January 2015, leaving behind the US as the fourth largest producer," the Ministry has said in a note.
According to WSA data, crude steel output in China -- the world's largest steel maker -- fell by 2.3 per cent to 803.8 MT in 2015 compared to the year-ago period.
Platts further said, "The big question is what will happen to Chinese steel production given the current huge overcapacity and the ongoing move from an investment led economy to a more consumer led one."
About the US, it said steel production is set to rebound after a double digit cut in production in 2015.

The recovery is partly as a result of keeping imports of steel out of the US market and because of improved demand from the construction sector and the car industry. This is tempered by a continued slowdown in steel demand from the oil and gas industry.
In 2015, the US produced 78.9 MT of crude steel, a decline of 10.5 per cent compared to 2014, whereas Russia showed a decrease of 4.3 per cent in 2015 with an output producing 101.5 MT of crude steel.