Steel consumption drops in Feb, first time since Nov 2015

New Delhi: India's domestic steel consumption in February fell for the first time in the last three months by almost 2 percent to 6.84 mt, something that doesn't augur well for the industry, which is banking on demand to pick up to spur growth.

However, steel imports last month fell marginally by 0.1 percent to 0.91 million tonnes (mt) compared with January 2016, but the decline was much steeper at 7.3 percent compared with the same month last year. This is the fourth consecutive year-on-year decline in in-bound shipments.

Domestic steel consumption in February stood at 6.84 mt, a decline of 1.9 percent against January, but it rose by 4.7 per cent from February 2015, latest data by the steel ministry's Joint Plant Committee showed.

This is the first fall in domestic demand since November last year when steel consumption fell 15.5 per cent to almost 6 mt from the preceding month, but rose 11.2 percent from a year earlier.

Even as in-bound shipments registered a fall, albeit marginally, in February 2016, import of finished steel grew by 20.5 percent to 10.22 mt during April-February of 2015-16, with India remaining a "net importer" of the metal so far this fiscal.

Also, steel production rose 1.8 percent yoy to 7.3 mt in February this year.

The increase comes after steel output in the world's third-largest producer fell 1.5 percent to 7.4 mt in January 2016.