About 150 small steel mills in India have temporarily halted production due to excessively low steel prices. This was announced by Indian Steel Secretary Sandeep Paundrik during the STEEL SUMMIT 2025 conference, emphasizing that the situation poses serious challenges for the entire industry.
“Today, steel prices are lower than they should be, and this is a big problem for small producers. Almost all companies showed a decline in profitability in the second quarter,” he said.
According to the official, the situation is getting worse just when the government plans to increase the capacity of the steel sector by 100 million tons over the next 5-7 years. At the same time, the market is under pressure from global overproduction, especially in China, which leads to dumping of imported steel and a further decline in prices.
“Excess capacity in China and its impact on world prices is a real problem not only for us but for all countries,” Poundrick stressed.
To protect domestic producers, the government has introduced a temporary duty on steel imports to stabilize the domestic market. At the same time, steel consumption in the country continues to grow, stimulating the introduction of new capacities.
Poundrik also stressed that the steel industry is strategic for India’s economic and national security.
“If we become dependent on imports, we will face risks, as is happening in the world today,” he said.
At the same time, the government sees prospects in the development of special and green steels. According to the secretary, the rapid decline in the cost of hydrogen could make it an economically viable substitute for natural gas in the next 5-10 years, paving the way for the production of green steel.
India reached its target steel production capacity of 205 million tons per year in the 2024/2025 financial year, according to a report by MP Financial Advisory Services. The country is moving towards its strategic goal of 300 million tons per year by the 2030/2031 financial year.
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