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Commenting on this development, President, ISSDA, KK Pahuja said, 鈥淭he ISSF Conference brought out far-reaching changes that are underway in the global stainless steel industry. On one hand, stainless steel capacity of 5.5 MT is ready in Indonesia. On the other hand, the Chinese government has withdrawn export tax rebate in May 2021, which will restrict the export of stainless steel from China. As a result, exports from China may come down, while exports from the same Chinese companies in Indonesia will rise significantly. This has serious implications for India as we estimate that import intensity from Indonesia will nearly double, as trade remedial measures like Countervailing Duty has been withdrawn since the announcement in the Union Budget.鈥�

Chinese companies have been setting up large capacities in Indonesia, exploiting multiple benefits like raw material proximity and local incentives. Since the capacity of over 5.5 MT set up in Indonesia is nearly 25 times the local demand of about 0.2 MT, it is evident that the production is entirely targeted at export markets. The production in Indonesia has been stable at about 2.2-2.4 MT during the last three years, even as capacity enhancement was in progress. Globally, China is the largest stainless steel producer in the world with a production of about 30 MT, which is about 60% of the global production in CY 2020. While the global stainless steel production declined by 2.5% in CY 2020 due to the impact of the pandemic, Chinese production rose by 2.5%, further cementing its dominant position.

Indian stainless steel market is the second-fastest-growing market after China and has been a victim of large-scale dumping of stainless steel flat products. In the pre-Covid period of 2019-20, as much as 24% of the market was captured by imports, half of which came from Indonesia. Indonesian stainless steel firms have, therefore, been facing trade actions for dumping and non-WTO compliant subsidies from across the globe, including China. With the beleaguered domestic stainless steel industry already operating at 60% of its capacity, and importing countries building irresponsible capacities, ISSDA estimates that the situation for the domestic industry, already reeling under the impact of Covid鈥檚 second wave, could soon spin out of control.  

ISSDA represented India and showcased major developments in the Indian stainless steel industry during the ISSF Annual conference, held during May 17-27. ISSF, a division of World Steel Association, held its annual conference ISSF25 virtually for the second consecutive year due to persistent Covid-19 pandemic situation. This conference brings together the global stainless steel industrsy on a common platform to discuss industry issues and ways to promote stainless steel. This year, many important sessions on sustainability, lifecycle cost, safety and health, raw materials, production, and market trends were presented and discussed.