India’s steel sector closed 2025 on a muted note, weighed down by slowing demand, margin pressure and weak export performance through much of the year. Flat steel producers faced the sharpest impact as softer demand from the automobile and consumer appliance segments, coupled with rising imports from Southeast Asia, limited any meaningful price recovery. In contrast, long steel products performed relatively better, supported by sustained government spending on infrastructure, although new capacity additions prevented prices from firming significantly.Raw material markets remained volatile during the year, though domestic iron ore prices stayed relatively firm on the back of steady consumption. Met coke and scrap markets largely traded within a narrow range despite rising global coking coal prices. Across the value chain, capacity additions continued at both integrated and secondary steel mills, intensifying competition and further pressuring margins. Exports remained subdued for most of 2025 amid global price weakness and continued uncertainty around Carbon Border Adjustment Mechanism (CBAM) compliance.Looking ahead, industry sentiment points to a gradual recovery in 2026, particularly after the first quarter. Policy clarity, continued infrastructure investment and stabilisation in housing and automobile demand are expected to support consumption, with overall steel demand projected to grow between 7 and 9 per cent. However, margins may remain under pressure in the early part of the year due to heightened competition and fluctuating raw material costs. Export prospects could improve modestly as international spreads strengthen, though CBAM-related compliance will remain a key determinant of long-term competitiveness.Amid rising overcapacity concerns and an increasing focus on sustainability, steel producers are expected to step up investments in energy efficiency, scrap processing and green steel technologies. While 2025 ends cautiously for the sector, a more constructive outlook is emerging for 2026, driven by policy support, demand recovery and strategic shifts across the steel value chain.Meanwhile, the coal sector is also preparing for structural change, with the proposed coal exchange likely to be launched in early 2026 following the release of draft regulations and the appointment of the Coal Controller Organisation as the regulator.