FCC

Opinion: Growth momentum in steel to continue into FY2022

2021-05-07

Domestic steel demand has witnessed a strong recovery in the second half of FY2021, with an estimated on-year growth of nearly 16 per cent between October 2020 and March 2021. This has primarily been supported by pent-up demand from construction and consumption-linked sectors.

The recovery in the second half will limit the demand contraction for fiscal 2021 to less than 7 per cent. Further, the growth momentum could continue in fiscal 2022, with increased government push for infrastructure spending along with recovering residential real estate. This will lift domestic steel demand by 13-15 per cent in FY2022, led by long-steel demand growth of around mid-teens.

The improved demand has also been accompanied by a steady increase in domestic steel prices.