Indian Stainless Steel Prices Record High: Will Renewing BIS License Impact the Industry?

Indian stainless steel market recorded a constant price surge since April 2024, following this the prices of 300 series are about 6 months high. The current prices of SS 300 series, especially 304 and 316 are similar to prices in November 2023.

Why the Stainless Steel Market Rebounds?

The prices of stainless steel by Indian top producers have been increased significantly in the last one and half months. With a constant surge, the total hike in prices since April is recorded at about Rs 12,000/ton (US$ 145) for 316 grades.

In May too price hike was noticed twice for both SS 200 and 300 series.  The first hike was announced on 9 May, while the second was on 15 May.

Higher prices of ferrochrome, molybdenum, and the key product Nickel, are triggering stainless steel prices worldwide, noted by OfBusiness.

Nickel Price Movements: Nickel is known as a key element for stainless steel production. The current prices of Nickel are at about 8-months high, similar to the last recorded price during September 2023 on LME’s three-month futures contract.

According to OfBusiness data, LME’s nickel prices surged by US$ 635/ton in May and overall about US$ 2,940/ton since April 2024, making producers worry about their input costs. As a result a significant price improvement was noted in stainless steel industry.

With the constant hike, the London Metal Exchange (LME) nickel futures prices currently stands at US$ 19,585/ton CFR Hamburg, Europe.

Ferro Molybdenum: Also, there is a sharp surge in prices of Indian ferro molybdenum. The prices  recorded a surge of Rs 1,24,000-1,25,000/t (US$ 1,485-1,500/ton) in May due to global supply shortage.

The molybdenum is a key alloying in the production of stainless steel and nickel-based alloys. Molybdenum is used to improve the resistance to pitting corrosion of stainless steel.

Considering the surging input costs and optimistic trends, the prices by major stainless steel producers in International market are expected to be increased for May-June deliveries. It will influence Indian mills to keep prices strong.

Will Renewed BIS License Impact the Industry?

Since the prices of base raw materials are trending high and there is less scope for major contraction in prices, the stainless steel market is expected to perform well even in a higher price range.

However, a concern rises in the industry due to recent renewal of BIS licences. This has worried Indian participants from a possible dump of steel at competitive prices in India. 

The expectations of renewal of BIS licenses for mills from FTA nations and China as well is igniting concerns in India, fearing increased imports. Last year, the Indian government halted renewals as a non-tariff measure to support domestic mills against rising imports, now potentially reopening to foreign competition.

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