India’s Steel Demand Rises 7% as Output, Exports and Capacity Continue to Expand in FY27

India’s steel sector maintained a positive growth trajectory during the first five months of FY2026-27, with finished-steel consumption rising faster than production, exports recording strong gains and domestic producers continuing to expand capacity and modernise operations.

According to provisional Joint Plant Committee data released by the Ministry of Steel, India produced 70.3 million tonnes of crude steel during April-August 2026, up 1.8% from 69 million tonnes in the corresponding period of the previous year. Finished-steel production increased more rapidly, rising 3.8% to 68.1 million tonnes, while hot-metal output grew 1.9% to 40 million tonnes.

The stronger signal, however, came from domestic demand. Finished-steel consumption reached 70.3 million tonnes during April-August 2026, compared with 65.7 million tonnes a year earlier, representing growth of 7%. In August alone, consumption increased 3.9% year-on-year to 14.3 million tonnes. The figures indicate that domestic steel demand continues to expand more rapidly than finished-steel production, supported by infrastructure construction, manufacturing, transport, housing and capital investment.

August Production Remains Broadly Stable

Monthly production in August showed a relatively stable picture. Crude-steel output stood at 14.1 million tonnes, almost unchanged from August 2025, while hot-metal production declined 1.1% to 8 million tonnes. Finished-steel production edged 0.3% higher to 13.5 million tonnes.

The stronger April-August performance therefore reflects cumulative growth across the opening months of the financial year rather than a sharp increase in August alone. Finished steel remains the fastest-growing of the three main production indicators for the fiscal year so far, with its 3.8% rise outpacing the growth recorded in crude steel and hot metal.

India Now Has 222.8 Million Tonnes of Crude-Steel Capacity

India’s annual crude-steel production capacity covered in the Ministry’s data stands at 222.8 million tonnes. The country’s seven major producers account for 117.4 million tonnes of this capacity, while remaining producers collectively account for another 105.4 million tonnes.

The major group includes Steel Authority of India Limited, Rashtriya Ispat Nigam Limited, NMDC Steel Limited, Tata Steel Group, ArcelorMittal Nippon Steel India, Jindal Steel and JSW Group.

During April-August, these leading producers manufactured 39.2 million tonnes of crude steel, 37.2 million tonnes of hot metal and 36.5 million tonnes of finished steel. Other producers contributed 31.1 million tonnes of crude steel and 31.7 million tonnes of finished steel, demonstrating the increasingly broad industrial base supporting India’s steel expansion.

The top seven producers account for roughly 53% of installed crude-steel capacity and around 56% of crude-steel production during the five-month period. At the same time, producers outside this group supplied nearly half of India’s finished-steel output, underlining the significant role of secondary and smaller integrated producers in the domestic market.

The public sector accounted for 13.9% of annual crude-steel capacity, 15.8% of crude-steel output and 13.5% of finished-steel production during the period. Its share of hot-metal production was considerably larger at 30%, reflecting the structure of major public-sector integrated steel plants.

Domestic Steel Prices Remain Above Last Year’s Levels

Steel prices showed a mixed month-on-month trend in August but remained substantially above their year-earlier levels across most major product categories.

The average price of 10-mm TMT bars rose 2.3% from July to ₹58,002 per tonne and was 5.8% higher than a year earlier. Two-mm hot-rolled coil increased 0.9% month-on-month to ₹70,448 per tonne and was 15.5% higher year-on-year.

Cold-rolled coil prices softened marginally by 0.2% during August to ₹76,462 per tonne but remained 13.3% above their level a year earlier. Galvanised plain sheet averaged ₹86,668 per tonne, up 0.3% from July and 17.7% year-on-year, the strongest annual rise among the products listed by the Ministry.

The government figures are inclusive of GST and represent average prices across Kolkata, Delhi, Mumbai and Chennai.

Steel Exports Surge, but India Remains a Net Importer

Trade data presents one of the more significant developments in the sector. India’s finished-steel exports rose sharply during April-August 2026, but imports also increased strongly enough to keep the country a net importer by volume.

Finished-steel imports reached 3.487 million tonnes, up 29.5% from 2.693 million tonnes in the corresponding period last year. Their value climbed even faster, rising 38.3% to ₹36,193.9 crore.

Exports increased 34.1% to 2.986 million tonnes, compared with 2.226 million tonnes a year earlier. Export earnings rose 32% to ₹23,646.6 crore.

This left India with a net finished-steel import position of approximately 501,000 tonnes during April-August 2026. In value terms, imports exceeded exports by roughly ₹12,547 crore during the period.

August alone showed a considerably narrower volume gap. India imported 721,100 tonnes of finished steel and exported 693,700 tonnes, leaving net imports of only about 27,400 tonnes for the month.

The export performance was particularly strong on a year-on-year basis. August exports rose 31.3% by volume and 41.5% by value, while imports grew 8% by volume and 23.3% by value. This suggests that export momentum strengthened considerably during the latest month even though India remained a marginal net importer.

Falling Iron Ore and Manganese Prices Offer Some Cost Relief

Raw-material prices moved favourably for integrated steelmakers during August, particularly for iron ore and manganese.

NMDC’s Bailadila lump ore price declined from ₹5,450 per tonne in July to ₹5,250 per tonne in August, a month-on-month fall of 3.7%. Iron-ore fines declined 4.3% to ₹4,500 per tonne.

MOIL’s specified manganese-ore lump price fell by a sharper 5% to ₹17,603 per tonne, compared with ₹18,530 in July and ₹19,505 in June.

Scrap prices moved in the opposite direction. HMS-II scrap increased 3.6% month-on-month to ₹39,970 per tonne, although the August figure remained below the ₹40,665-per-tonne level recorded in June.

The decline in major domestic ore prices could provide some input-cost support to steelmakers, although individual producers remain exposed to other cost variables including imported coking coal, energy, freight and scrap.

Metal Stocks Strengthen Despite Softer Manufacturing PMI

Broader market indicators produced a mixed picture during August. The average Nifty Metal Index rose 5% month-on-month to 13,181.8, placing it 41.7% above its year-earlier level.

At the same time, India’s manufacturing PMI moderated from 53.5 in July to 52.8 in August, though it remained above the 50-point level associated with expansion.

The average Baltic Dry Index, an indicator of global dry-bulk shipping conditions, increased 6.5% from July to 2,951.1 and was 47.5% above its year-earlier level. These movements are relevant to steel because the industry is heavily exposed to bulk shipping for raw materials such as iron ore and coking coal as well as international steel trade.

SAIL Expansion and Modernisation Remain in Focus

Alongside the production and market data, the Ministry highlighted a series of industrial initiatives being undertaken by major public-sector companies.

Union Steel and Heavy Industries Minister H.D. Kumaraswamy reviewed SAIL’s performance, capital-expenditure programme and expansion plans, stressing faster modernisation, greater efficiency and capacity expansion.

The review comes as SAIL seeks to reinforce its position within India’s rapidly expanding steel market, where both large private-sector producers and secondary manufacturers are investing in new capacity.

SAIL has also received Top Employer certification from the Top Employers Institute, valid until December 2027. This follows its third consecutive Great Place To Work certification.

NMDC Production Rises More Than 20%

Iron-ore major NMDC recorded production of 4.07 million tonnes in August 2026, an increase of 20.8% year-on-year. Sales reached 3.58 million tonnes, up 5.6%.

For April-August FY27, NMDC produced 23.23 million tonnes of iron ore and sold 18.72 million tonnes. Its Kirandul, Bacheli and Donimalai mining complexes each recorded their highest-ever August production, strengthening raw-material availability for India’s growing steel industry.

NMDC has also achieved another commissioning milestone at its 2-million-tonne-per-annum Nagarnar Pellet Plant by lighting up the indurating machine.

The equipment forms a critical part of the pelletisation process, converting green pellets into hardened iron-ore pellets through carefully controlled heating and cooling. Commissioning of the plant will increase NMDC’s ability to move further into mineral processing rather than relying solely on the production and sale of raw iron ore.

India and Sweden Expand Cooperation on Green Steel

Decarbonisation is becoming an increasingly important component of India’s steel strategy as producers prepare for tighter global carbon standards and seek to reduce emissions from one of the country’s most energy-intensive industries.

The Steel Research and Technology Mission of India and Sweden’s SWERIM have signed an MoU covering steel research, technology and innovation.

The partnership includes joint research and development in green steel, decarbonisation, circular economy technologies, advanced steels, artificial intelligence, machine learning and digitalisation, along with capacity building.

The collaboration can support India’s efforts to develop lower-emission production technologies while strengthening access to specialised metallurgical research capabilities.

India is also exploring deeper steel-sector engagement with Canada. Glenn Purves, Deputy Minister at Global Affairs Canada, met Steel Secretary Sandeep Poundrik to discuss trade, investment and technological collaboration across the steel value chain.

Bhilai Steel Plant Introduces Daily Carbon-Emission Monitoring

SAIL’s Bhilai Steel Plant has meanwhile introduced a CO₂ Dashboard covering both Bhilai Steel Plant and the Chandrapur Ferro Alloy Plant.

The digital system enables daily monitoring of carbon emissions and is designed to identify operational deviations quickly, support corrective measures and improve emissions management.

For an industry facing growing pressure to reduce carbon intensity, digital monitoring provides an important foundation for subsequent investments in energy efficiency, process optimisation, hydrogen use, carbon capture and other decarbonisation technologies.

Demand Growth Emerges as the Central Steel-Sector Story

The April-August numbers show that India’s steel sector is expanding on several fronts simultaneously. Crude-steel output has crossed 70 million tonnes in just five months, finished-steel production has risen nearly 4%, and domestic consumption has grown at a considerably stronger 7%.

At the same time, India’s 222.8-million-tonne annual crude-steel capacity base continues to widen beyond the largest integrated producers. Export growth has accelerated sharply, even as stronger imports have kept India in a net-import position during the financial year so far.

The combination of rising domestic consumption, expanding capacity, lower prices for some domestic raw materials, strong NMDC production and continuing investments in modernisation and green steel points to a sector undergoing both quantitative expansion and structural change.

India’s next phase of steel growth is increasingly being shaped not simply by higher tonnage, but by the need to build technologically advanced, lower-carbon and globally competitive production capacity. The April-August 2026 performance shows that domestic demand remains the industry’s strongest underlying driver, while trade competitiveness, capacity expansion and decarbonisation are emerging as the decisive factors that will determine the sector’s longer-term trajectory.

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