India’s steel sector continued to record growth in May 2026, supported by strong domestic demand from construction, infrastructure, and manufacturing sectors. Key indicators, including crude steel production, finished steel output, and consumption, showed year-on-year increases, reflecting the resilience of the country’s steel industry.
The latest provisional data released by the Joint Plant Committee (JPC) show that finished steel consumption grew faster than production during the month. This indicates healthy demand conditions in the domestic economy despite ongoing cost pressures faced by producers.
At the same time, the industry witnessed rising imports, higher raw material costs, and declining domestic steel prices. While capacity expansion projects and green steel initiatives continued to gain momentum, pressure on profit margins may remain a challenge in the near term.
Key Highlights
- Crude steel production rose 2.9% year-on-year to 14.21 million tonnes in May 2026.
- Finished steel production increased 7.7% YoY to 13.94 million tonnes.
- Finished steel consumption grew 9.0% YoY to 14.33 million tonnes, indicating strong domestic demand.
- India remained a net importer of steel during April-May 2026, with imports rising 45.0% over the corresponding period last year.
- India’s crude steelmaking capacity reached around 220 million tonnes per annum (MTPA) in FY 2025-26, moving towards the National Steel Policy target of 300 MTPA by 2030.
- Rising raw material costs and lower steel prices may put pressure on producers’ margins despite favourable demand conditions.
Production and Demand Trend
Crude steel production stood at 14.21 million tonnes in May 2026, recording a growth of 2.9% compared with May 2025. Hot metal production increased by 2.0% year-on-year, while pig iron output reached 0.77 million tonnes, registering a growth of 1.1%.
Finished steel production rose to 13.94 million tonnes during the month, up 7.7% from a year earlier. Finished steel consumption increased even faster, reaching 14.33 million tonnes, reflecting a 9.0% year-on-year growth.
For the April-May 2026 period, crude steel production reached 28.04 million tonnes, compared with 27.30 million tonnes during the corresponding period last year, representing a growth of 2.7%.
During the same period:
- Hot metal production grew 2.7%.
- Pig iron production reached 1.50 million tonnes, up 0.2%.
- Finished steel production increased 6.4% to 27.36 million tonnes.
- Finished steel consumption also stood at 27.36 million tonnes, registering growth of 8.7%.
The continued increase in steel consumption suggests sustained activity in construction projects, infrastructure development, and manufacturing industries, all of which remain major consumers of steel.
Also Check: India Steel Industry Growth April 2026: Production, Demand & Prices Rise
Trade Dynamics
India’s steel trade recorded strong growth in both imports and exports during May 2026. Imports stood at 0.69 million tonnes during the month, increasing by 62.5% compared with 0.42 million tonnes in May 2025. Exports reached 0.51 million tonnes, registering a growth of 29.9% over 0.39 million tonnes recorded a year earlier.
During April-May 2026, imports rose to 1.37 million tonnes, while exports stood at 0.98 million tonnes. As imports exceeded exports, India remained a net importer of steel during the period.
Compared with April-May 2025: Imports increased by 45.0%, and Exports grew by 27.4%. The higher import growth could indicate stronger domestic demand, differences in product competitiveness, or industry-specific supply requirements.
Capacity Expansion and Investment Momentum
India’s total crude steelmaking capacity reached approximately 220 MTPA during FY 2025-26. This expansion keeps the industry on track towards achieving the National Steel Policy target of 300 MTPA by 2030.
Two major developments highlighted the sector’s investment momentum. Steel Authority of India Limited (SAIL) approved the expansion of its Bhilai Steel Plant. The plant’s crude steel capacity will increase from 6.8 MTPA to 10.2 MTPA.
In addition, JSW Steel began construction of its integrated steel plant at Paradip, Odisha, in May 2026. The project is being developed in phases and will have a planned capacity of 13.2 MTPA.
These investments reflect confidence in the long-term growth potential of India’s steel industry and support the country’s industrial expansion goals.
Green Steel Initiatives
Under the Ministry of Steel’s Green Steel Initiative, green steel certificates had been issued to 94 producers across 15 states as of 31 May 2026.
The certified products included: TMT Bars, HR Coils, CR Coils, Plates, Wire Rods, and Pipes.
Most of the certified products received the highest 5-star rating under the framework. The participation of secondary and medium-sized producers suggests a growing focus on reducing carbon intensity and adopting more sustainable production practices within the steel sector.
Steel Price Scenario
Domestic steel prices declined on a month-on-month basis across major product categories during May 2026.
TMT or rebar prices fell by around 1.3% compared with April 2026. However, they still recorded a year-on-year increase of approximately 4.5%, marking the first positive annual growth after several months of weakness.
Flat steel products also witnessed a decline in prices: HR Coil prices decreased by around 0.2% month-on-month, and GP Sheet prices also fell by approximately 0.2%. Lower steel prices may support steel-consuming industries, although they can affect profitability for producers.
Raw Material Overview
Raw material costs continued to rise during May 2026. NMDC increased domestic iron ore prices by ₹200 per tonne during the month.
MOIL produced 0.17 million tonnes of manganese ore in May 2026, representing a 4% month-on-month increase in output. However, manganese ore prices declined by 4% during the same period.
International markets also reflected cost pressures. Global seaborne iron ore prices remained volatile. International coking coal prices rose by 2.8% month-on-month to reach $239 per tonne, increasing cost pressures for integrated blast furnace-basic oxygen furnace (BF-BOF) producers.
International scrap prices also moved higher, adding to input cost pressures for electric-route steelmakers.
Overall, the Indian steel industry continues to benefit from strong domestic demand supported by infrastructure spending and expanding manufacturing activity.
However, declining steel prices alongside rising raw material costs may put pressure on producers’ profitability in the near term. Even so, the underlying demand environment remains favourable, supported by ongoing investment activity and economic growth.
Source: Ministry of Steel
