Care Cuts FY20 Steel Production Growth Estimate By Half

Rating agency CARE has cut its steel industry production target set in February by half, from a range of 6-8 percent to 3-4 percent.

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“This is because 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 steel production rate is a downward revision from our earlier estimate of 6-8 percent released in February 2019,” CARE said in a research report.

CARE sees steel consumption to grow by 5-6 percent on the back of government’s expenditure towards infrastructure and construction.

“With the same government coming to power, the focus will continue to remain on infrastructure development in the country,” it said.

Price outlook

While the international steel prices has seen some softening during the last 6-8 months, prices in the domestic market has remained firm mainly on account of stable demand from the end user sectors and the protectionist measures adopted by the government safeguarding the domestic steel prices.