Care Ratings: India’s steel production growth by 141.7% in April 2021

India’s steel production and consumption saw exponential growth of 141.7% and 516.4%, respectively, in April 2021 compared with April 2020. However, this was mainly due to low base effect as production and demand for steel were severely hit in the corresponding month of 2020 when nationwide lockdown was imposed due to the coronavirus pandemic. On a monthly basis, the pace of steel production slowed down in April 2021 to 7.9 million tonne (mt) after hitting 10 mt in March 2021 and 9.1 mt in February 2021, according to a Care Rating report. This translates into a 20.6% m-o-m fall. Steel production in April 2021 was the lowest since June 2020. Similarly, production of finished steel also reduced to 7 mt in April 2021 from 9.1 mt a month earlier. Consumption too fell by 25.7% m-o-m. The rising Coronavirus cases across the country, labour exodus and the diversion of liquid oxygen to hospitals for covid patients have impacted steel production during the month. Integrated steel producers have their own captive oxygen plants for steelmaking. The rising coronavirus cases in the country and the shortage of oxygen cylinders has necessitated some industries including steel and oil to divert liquid oxygen to the hospitals for covid patients. Steel mills producing steel through Blast Furnace/Basic Oxygen Furnace route are giving priority to supplying liquid oxygen for medical aid. As per the Ministry of Steel, both public and private sector steel plants have ramped up daily production capacities, including through diverting liquid nitrogen and argon production capacity towards production of additional quantities of Liquid Medical Oxygen (LMO). Read the full report here. Image source