India's Steel Sector Performance Q1 FY 2026–27

India's steel sector demonstrated sustained growth momentum during the first quarter of fiscal year 2026–27, with crude steel production reaching 42.1 million tonnes (Mt), representing a 3.0% year-on-year increase from 40.8 Mt in the corresponding period last year. Finished steel production grew 4.9% to 40.6 Mt, while hot metal production increased 1.4% to 23.5 Mt. Monthly data for June 2026 showed crude steel output at 14.1 Mt (up 4.5% YoY), finished steel at 13.5 Mt (up 3.8% YoY), and hot metal production remaining nearly flat at 7.9 Mt.

Production Capacity and Segment Analysis

The total crude steelmaking capacity reached approximately 222 million tonnes per annum (MTPA) as of June 2026, progressing toward the National Steel Policy target of 300 MTPA by 2030. The top 7 producers (SAIL, RINL, NSL, TSL Group, AM/NS, JSL(JSPL), and JSW Group) with combined capacity of 117.4 MTPA produced 23.2 Mt of crude steel, 21.7 Mt of finished steel, and 21.8 Mt of hot metal during April-June 2026. The remaining producers (104.6 MTPA capacity) contributed 18.9 Mt of crude steel, 18.9 Mt of finished steel, and 1.7 Mt of hot metal. The public sector accounted for 15.7% of crude steel production and 13.2% of finished steel production.

Steel Price Trends

Steel prices showed a declining trend month-on-month in July 2026 across major product categories. TMT (10 mm) prices decreased 5.6% to ₹56,698 per tonne, though they remained 3.7% higher year-on-year. HR Coil (2 mm) prices declined 0.4% to ₹69,828 per tonne (up 13.3% YoY), CR Coil (0.63 mm) fell 0.6% to ₹76,583 per tonne (up 14.7% YoY), and GP Sheet (0.63 mm) remained nearly stable at ₹86,415 per tonne (up 18.9% YoY). All prices are inclusive of GST and based on average prices from four metro cities—Kolkata, Delhi, Mumbai, and Chennai.

Alloy and Stainless Steel Performance

Alloy steel production surged 28.2% to 2.73 million tonnes in Q1 FY27, with consumption growing 25.6% to 3.00 million tonnes. Imports increased 18.6% to 339,500 tonnes while exports more than doubled, rising 106.0% to 78,100 tonnes. Stainless steel production declined 1.9% to 1.03 million tonnes, but consumption jumped 27.5% to 1.28 million tonnes. Stainless steel imports surged 86.7% to 310,400 tonnes while exports fell 36.6% to 121,600 tonnes.

Demand and Consumption Patterns

Finished steel consumption showed robust growth, increasing 8.3% year-on-year to 41.6 million tonnes in Q1 FY27. Monthly consumption in June 2026 reached 14.2 million tonnes, representing 7.5% growth compared to June 2025.

Trade Dynamics and Import-Export Analysis

India became a net importer of finished steel during April-June 2026, with imports surging 49.2% to 2.06 million tonnes (valued at ₹20,214.5 crore, up 44.2% YoY) while exports grew 31.4% to 1.59 million tonnes (valued at ₹12,475.2 crore, up 27.6% YoY). China was the largest import source with 660,700 tonnes (32.0% share), followed by Korea with 599,600 tonnes (29.1%) and Japan with 336,300 tonnes (16.3%). The UAE was the top export destination with 249,000 tonnes (15.6% share), followed by Vietnam with 247,100 tonnes (15.5%).

By product category, HR Coil/Strip dominated imports with 779,800 tonnes (37.8% share), while it also led exports with 580,900 tonnes (36.5% share). CR Coil/Sheets were the second-largest import category at 356,600 tonnes (17.3%), while pipes were the second-largest export category at 263,900 tonnes (16.6%).

Raw Material Price Movements

Domestic raw material prices declined month-on-month in July 2026. NMDC Iron Ore Baila Lump (65.5%, 10-40 mm) fell 4.4% to ₹5,450 per tonne, while NMDC Iron Ore Baila Fines (64%, -10 mm) decreased 3.1% to ₹4,700 per tonne. MOIL Manganese Ore Lump (Mn 37%, Fe 7.5%) dropped 5.0% to ₹18,529 per tonne, and Scrap—HMS II declined 5.1% to ₹38,580 per tonne.

Key Indices Performance

The Nifty Metal Index averaged 12,971.9 in June 2026, declining 1.9% month-on-month but showing strong 39.3% year-on-year growth. The PMI Manufacturing Index stood at 54.2 in June, down 1.5% from May but indicating continued expansion. The Baltic Dry Index averaged 2,779.9 in June, falling 8.8% month-on-month but rising 64.9% year-on-year.

Policy and Industry Initiatives

Union Steel Minister H.D. Kumaraswamy visited SAIL's IISCO Steel Plant to review expansion projects and inaugurated an 84,000 m³ RCC water reservoir. SAIL announced that Bokaro Steel Plant will receive 8.3 MT of iron ore annually through India's longest steel-sector slurry pipeline (258-km Jamda–Bokaro pipeline). MECON and RITES signed an MoU to pursue consultancy and infrastructure projects jointly. Bhilai Steel Plant signed an EPCM consultancy agreement with MECON to support expansion from 7 MTPA to 10.2 MTPA.

International Cooperation and Green Steel Initiatives

SAIL signed an MoU with Indonesia's PT Krakatau Steel to explore a joint venture for manufacturing stainless steel slabs in Indonesia. SAIL received the Golden Peacock Environment Management Award 2026 for excellence in environmental sustainability. Under the Ministry of Steel's Green Steel Initiative, 97 producers across 15 states received Green Steel Certificates, with most receiving the highest 5-star rating for products including TMT Bars, HR/CR Coils, Plates, Wire Rods, and Pipes.