Production of finished steel to decelerate to 3-4%

The production of finished steel in FY20 is slated to decelerate to 3-4 per cent year-on-year as large steel players plan to hold back ramp-ups in the wake of depressed prices and slump in automobile sales. “No major capacity is expected to come up from large steel players while the small steel players are estimated to increase their output at a rate similar to last year. The commissioning of projects by large companies is expected to come up in later years”, said Bhagyashree C Bhati, research analyst at CARE Ratings. The gloomy outlook on finished steel output comes after five years of consecutive firm growth between FY15 and FY19. During this time span, domestic crude steel production grew by 4.8 per cent compounded annual growth rate (CAGR). India is the only country among the top five steel producing nations (China, Japan, the US and Republic of South Korea) to have clocked growth in the last five years. All the other nations in the group had to suffer de-growth in one year or more.