ArcelorMittal, one of the world’s steel giants, will build the world’s largest steel manufacturing plant in Hazira, Gujarat, western India, with the overall project expected to start production in 2029. Some scholars believe that this could lead to a gradual reduction in India’s demand for steel from Southeast Asia. However, some more optimistic market participants believe that given India’s fast-growing steel demand, the new capacity can be absorbed by its domestic market, so Indian buyers’ steel demand for the rest of Asia will not change much.
Lakshmi Mittal, executive chairman of Ammi, announced in early January that the first phase of the expansion of its steel manufacturing plant in Hajra, Gujarat, India, will be completed by 2026, and the company has received environmental permits from the local government. The second phase of the project’s expansion will be completed in 2029 with an annual capacity of 24 million tons, and the new steel manufacturing plant will be the world’s largest steel manufacturing plant after completion, Ammi said at the “Vibrant Gujarat 2024″ summit held in Gujarat, India, from January 10 to 12. Market participants have mixed opinions about Ammi’s plan to expand steel production capacity in India. “India’s steel demand will increase by 50 million tonnes ~ 60 million tonnes in the next few years,” an Indian producer said. To meet this demand, many local steel groups have closed their factories in Europe and built factories in India instead. The cost of local production in India is lower than in Europe, and the proximity to the consumer market is an advantage for steel groups. The domestic market will easily absorb the new capacity. While the new plant alone may not dampen India’s demand for Southeast Asian steel products, the rapid growth of Indian steel production capacity will still impact Southeast Asia’s steel market share in the future, an Indian trader said.
A concern is whether the rapid growth of steel production capacity in India and the increase in steel production in Southeast Asia will lead to a severe oversupply of steel products in the region, according to a Singaporean trader. The Singaporean trader believes that if something like this does happen, it will definitely have an impact on steel prices in the regional market. Notably, Ammi’s announcement comes just days after another major steel project in India was approved, with JSW Steel acquiring a piece of woodland in the eastern Indian state of Odisha for the construction of an integrated green steel mill. In recent years, India, Iran and other countries are building a “steel dream”, while the rapid growth of steel production capacity in Southeast Asia, the steel industry in Asia is about to enter a stage of head-to-head competition. Extended reading: At the same time as China’s steel demand is de-realized, the economic development of Southeast Asian countries has entered the fast lane, driving the steel demand of Southeast Asian countries to grow significantly. For Chinese steel companies, Indonesia is becoming a market full of potential to go overseas. In June 2024, we are waiting for you at the Jakarta International Exhibition Center to tap new increments and open up new markets.
Post time: Feb-21-2024