India Steel Capacity Utilisation to Stay Above 90% Through FY29

Steel News  |  2026-08-31 06:41:34   |   By

India’s steel industry is expected to maintain capacity utilisation above 90% through FY2029, supported by strong domestic consumption and infrastructure activity, according to a recent research report published by Kotak Institutional Equities.

Summary
  • Steel capacity utilisation expected to stay above 90%: India’s steel industry is likely to maintain capacity utilisation above 90% through FY2029, supported by robust domestic demand. Kotak Institutional Equities expects steel consumption to grow nearly 7% annually between FY2026 and FY2029.
  • Steel prices recover after monsoon-related weakness: Long steel prices have rebounded following the June-July correction. Primary and secondary rebar prices increased by about INR 5,600 per ton, reaching INR 53,900 and INR 47,900 per ton, respectively, while HRC prices stood at around INR 58,800 per ton.
  • Trade and margins remain key factors: Steel exports increased 35% year-on-year to 2.3 million tons, while imports climbed 36.7% to 2.8 million tons. Anti-dumping investigations could help contain import pressure, while margins may weaken in Q2 FY2027 before potentially recovering in the second half.

SEATTLE (Scrap Monster): India’s steel industry is expected to maintain capacity utilisation above 90% through FY2029, supported by strong domestic consumption and infrastructure activity, according to a recent research report published by Kotak Institutional Equities.

The brokerage expects domestic steel demand to expand at nearly 7% annually between FY2026 and FY2029, significantly higher than the anticipated pace of capacity additions. It must be noted that domestic steel consumption grew 7.8% year-on-year in the first part of FY2027, following 7.7% growth in FY2026.

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Steel exports climbed 35% year-on-year to 2.3 million tons, while imports rose 36.7% to 2.8 million tons. The report noted that ongoing anti-dumping investigations could help limit import pressure.

Long steel prices have recovered strongly after their June-July decline. Rebar prices in both primary and secondary markets increased by about INR 5,600 per ton, reaching INR 53,900 and INR 47,900, respectively. The easing monsoon and improving construction activity could provide further support to prices, the report said. Meanwhile, domestic HRC prices stood around Rs 58,800 per ton.

Steel margins may weaken in the second quarter of FY2027, but recent price gains and better operating leverage are expected to support recovery in the second half.