According to the latest market research study released by Technavio, the Indian steel industry is expected to grow at a CAGR of almost 7% during the forecast period 2016-2020.
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Technavio research analysts categorize the Indian steel industry market based on end-user:
Indian steel industry share by end-user 2015
|
Construction |
34% |
|
Infrastructure and transport |
28% |
|
Others |
22% |
|
Automotive |
16% |
Source: Technavio
The top three revenue generating end-user segments are discussed below:
Indian steel industry in construction sector
In 2015, the construction sector accounted for around 34% of the Indian steel industry. The main reason behind the rapid growth of the construction industry in the emerging economies such as India, is the infrastructure reforms supported by the government. Further, the increase in the middle-class population will also increase the demand for residential properties in the country. Steel plays an important role in the sustainability of a building. It is used for the construction of various buildings such as tall towers, petrol refineries, shopping malls, and residential houses. Steel is in high demand among the architects and engineers due to its strength, attractive appearance, and versatility.
“The distinct properties of steel showcase a combination of structural support as well as an artistic impact on different structures. For example, the steel used for construction possess specific properties such as decreased thickness of the product, high-yield strength, toughness at low temperatures, and outstanding weldability. Such definitive characteristics of steel satisfy both the safety as well as sustainability criteria by fulfilling the requirements of the construction industry for light as well as economic structures,” says Ajay Adhikari, a lead analyst at Technavio for research on metals and minerals.
Indian steel industry in infrastructure and transport sector
The transport sector accounted for around 28% of the Indian steel industry in 2015. During the forecast period, the increased focus on manufacturing industry is likely to drive the Indian steel industry. The major drivers of demand for steel in India are roads, rail, ports, airports, and the power sector. The steel products are used in various kinds of ships including container ships, cruise ships, general cargo carriers, large tank ships that carry liquefied natural gas, and offshore drilling platforms. In the transport industry, steel is used to make sustainable transport infrastructure which reduces carbon emissions throughout the product life cycle. In the rail industry, steel is used in both railway tracks as well as trains. Further, it is also used in wagons which makes the wagon lighter however, with few emissions. This helps in the reduction of steel requirement as well as reduction of emissions from production and transport.
In the oil and gas industry, hot-rolled coils, long reinforcing bars, steel plates, steel sections, tubes, and wire products are consumed for the construction onshore and offshore platforms, fuel storage, liquefied natural gas ships, pipelines, and refineries. The performance steel is used for onshore and offshore structures, as sheet piles for land and port infrastructure, containment, and reinforcing bars. Special steel plates such as high-purity steel grades are consumed for nuclear reactors, nuclear waste transport, and storage casks. For power generation and petrochemicals processing units, steel plates are an essential element of pressure vessels and structural applications. In the wind energy sector, steel is used as high-strength structural steel plates, long sections for tower structures, concrete reinforcing bars for foundations, and electrical steels for generators. Steel products such as saw wires are consumed to cut silicon wafers as building blocks for photovoltaic solar cells in the solar energy sector.
Indian steel industry in automotive sector
In 2015, automotive sector accounted for around 16% of the Indian steel industry. Steel has the largest application in the automotive sector and accounts for around 65% of the material used in passenger cars. Steels products, such as advanced high-strength galvanized coated steel, are used in the manufacturing of cars, vans, and trucks. In the production of vehicles that are stronger yet lighter than the existing steel materials, advanced steel products are used. It is expected that the demand for lightweight cars will increase during the forecast period with many manufacturers producing light vehicles without compromising on safety standards and carbon emissions. For example, electrical steels that enhance efficiency for new generation hybrid and electric cars are undergoing development. The automotive industry is likely to witness huge growth due to the increased demand for automobiles leading the manufacturers to enter into joint ventures with automotive manufacturers for steel supply.
The top leading vendors operating in the Indian steel industry are:
- Essar steel
- JSW Steel
- RINL
- SAIL
- Tata Steel
Other prominent vendors in the Indian steel industry include Bhushan Steel, Facor Steels, Gerdau, Jindal Steel & Power, Mahamaya Steels Industries, MESCO Steel, and VISA Steel.
A more detailed analysis is available in the Technavio report titled, ‘Indian Steel Industry 2016-2020’. Technavio also customizes reports by other regions and specific segments upon request.
Other related reports:
- Global Steel Rebars Market 2016-2020
- Global Steel Long Products Market 2016-2020
- Global Steel Flat-Rolled Products Market 2016-2020
- Global Steel Industry Market 2015-2019
- Steel Market in ASEAN Countries 2015-2019
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