India’s Steel Imports Drop 40% in February Amid Safeguard Duty Concerns; Exports Plunge 60%

Imports of steel into India plunged 40% in February to 0.6 million tonnes the lowest level since April. This drop was 29% lower than January’s level, the second significant drop since November. Reflecting this, the fall has been primarily in reaction to a potential safeguard duty, as talking points for an ongoing Directorate General of Trade Remedies (DGTR) inquiry have bred uncertainty amongst purchasers.

The DGTR investigation is considering whether safeguard duties are needed to safeguard domestic producers from surging imports, especially from countries like China. The prospect of further tariffs has created a hesitant stance among importers, which has served to dampen new orders. The amount of Chinese steel coming in also dropped, a further sign of timidity in the market.

The export scene was even bleaker. India’s steel exports plunged 60 percent in February compared to a year ago, as domestic producers here try to juggle the balance of their homegrown focus amidst rising and falling international demand for their specialty products. In addition, increasing global competition as well as price pressures add to the woes of Indian exporters.

Officials and market experts say that if safeguard duties are levied, it will bring temporary respite to local manufacturers by reducing the influx of cheap imports. But this approach could also raise costs for downstream industries that depend on imported steel, which will complicate the calculus for policymakers.

The steel sector is an important part of India’s industrial landscape and is watching the DGTR’s decision closely. A cautious approach is being requested from the authorities by Industry stakeholders to keep domestic production safe from an adverse price situation but not end up creating a severe impact on costs for consumers and related sectors. Both imports and exports remain somewhat uncertain, the market on watch as the investigation proceeds.