Every industry was affected during the pandemic, resulting in a severe struggle between supply and demand. The epidemic interrupted the production of construction steel, which had a significant impact on global supply networks. Another cause of concern was rising market prices. This had an unavoidable impact on the steel production demand-supply scenario, resulting in a delay in the development of civil constructions.
To learn about the global pandemic’s impact on the Indian steel manufacturing industry, please read the blog thoroughly.
The Impact of Global Pandemic on the Indian Steel Manufacturing Industry
- Decrease in demand – During the global epidemic, all construction projects have been stopped due to the lockdown, and the real estate sector has suffered heavy losses during this period.
- Construction Steel shortages have become a prevalent concern – Construction steel production has dropped as a result of the low demand. At the same time, businesses are being forced to offer their products at a lower price to recover their losses. The steel industry contributes around 2% to the Indian GDP. The contribution suffers as a result of the supply-demand imbalance.
- Delivery constraints due to transportation shortages – Transportation sectors also provide limited service during a pandemic to avoid a medical emergency spreading from one place to another. Due to transportation limits, all steel production plants experienced considerable difficulty clearing inventories after obtaining a sales order. As a consequence of higher transport costs, delivery fees grew in line with material rates.
Despite significant obstacles throughout the pandemic, India’s steel sector is still attempting to restore its earlier position with the help of some Indian policies and projects. The Indian government has announced a number of initiatives to promote the development of the domestic steel industry over the years, such as expanding steel-consuming sectors including rail transportation networks, passenger and freight corridors, high-speed railway tracks, affordable housing projects, and so on. With all of these facilities, India became the world’s second-largest crude steel producer in 2022, following China, and the sector’s growth rate has consistently exceeded the country’s GDP growth rate.