Steel prices in 2025 could rise significantly if the proposed safeguard duty on imports is imposed by the end of next month, according to Crisil. Domestic prices are currently under pressure due to global price declines, but a 4-6pct price increase is possible with the safeguard duty in place.
As mills increase production from newly commissioned capacities, flat steel prices may decrease but will still be higher than in 2024. However, intense competition among mills could limit price hikes, said Vishal Singh, Director of Research at Crisil.
The proposed safeguard duty could drive prices higher, particularly in the first half of 2025, assuming it is implemented by the end of February. In 2024, domestic steel prices fell due to higher imports. HRC prices dropped by 9pct, and CRC prices fell by 7pct, impacting the topline growth of domestic mills.
Despite this, falling coking coal prices, which dropped 12pct for premium low-volatility grades, helped mitigate margin pressures. Meanwhile, iron ore prices increased by 9-10pct. China’s HRC export prices fell 12pct in 2024, remaining lower than domestic mill prices.
Crisil also forecasts an 8-9pct growth in domestic steel demand in 2025, driven by increased demand in housing, infrastructure, and engineering sectors. In contrast, global steel demand declined by 1pct in 2024, with China seeing a 3.5pct drop due to weak demand from the real estate sector. However, demand growth in India, Brazil, and other developing economies helped mitigate global declines.
