New York — China was India's top export destination for its finished steel during April-September, the first half of the Indian fiscal year, overtaking Vietnam after exports soared to about 1.90 million mt from 2,500 mt a year earlier, provisional data from the Joint Plant Committee showed Oct. 22.
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In fiscal H1 exports to Vietnam rose to 1.61 million mt from 1.04 million mt a year earlier when it was Indian steel's top destination.
India swung to a net steel exporter during H1 from a net importer a year earlier with exports at 6.54 million mt, a 66.3% surge year on year, while imports fell 50.6% to 1.99 million mt.
Hot-rolled coils made up the bulk of H1 steel exports at 4.49 million mt, surging 96.8% on the year
However, in September, Indian steel exports showed signs of slowing and were down 16.8% from August and 15.2% from September 2019 to 864,000 mt, which could be attributed to rising demand from domestic vehicle makers, especially for HRC.
India produced 2.62 million vehicles in September, up 12.0% year on year and 21.3% more than in in August, data from the Society of Indian Automobile Manufacturers showed Oct. 16, as the country emerged from lockdown.
"The months of October and November bring with them the much awaited festival season of Navratri, Durga Puja and Diwali," the Federation of Automobile Dealers Associations said Oct. 8, anticipating "a high growth period during these two months for automobile sales in India."
"With the government's persistent effort to unlock India, the month of September continued to witness automobile registrations on a rise as compared to previous months," FADA President Vinkesh Gulati, said.
"We are expecting good demand in the festive season...," SIAM President Kenichi Ayukawa said Oct. 16. "Thanks to government intervention, auto loan interest rates are below 8%, the lowest in a decade and that should encourage customers to purchase new vehicles."
Passenger vehicle sales grew 26.5% year on year to 272,027 units in September, the SIAM data showed, as producers pushed more vehicles to dealerships, anticipating higher demand ahead of the festive season which began Oct. 17. However, the market is expected to watch auto sales during the upcoming festive season in November.
"The upcoming festive period and expected continual pick-up in economic activity would guide future offtake but on a full year basis we expect discretionary spend related segments i.e. 2 Wheelers, Passenger Vehicles to post an around 15% year-on-year fall while commercial space drop-off set to be sharper at around 25% plus," Shashank Kanodia, analyst at ICICI Securities said. "Tractor industry, however, is seen growing in single digits for the year."
The bullish performance of the vehicle industry has benefited domestic steelmakers such as Tata Steel which said its July-September sales were the highest ever, driven by its automotive and special products sector.
"The auto numbers are even better than last year but not sure how long can they last when GDP growth is falling so much," a mill source with Tata Steel said.