According to Fitch Ratings, Indian steel companies are expected to encounter pricing challenges in the coming fiscal year as they struggle with an influx of lower-priced Chinese imports and potential tariff policy risks.

Chinese steel producers have been struggling with profitability amid a prolonged property market downturn that has dampened domestic demand, resulting in increased exports to markets like India. The situation has led to record steel imports into India from China, South Korea, and Japan during the first ten months of the current fiscal year.

This surge in discounted steel imports has significantly impacted the market, with domestic steel prices dropping to their lowest level in over three years during August of last year.

In addition, although the US 25% tariffs are expected to have little direct impact on Indian steel manufacturers, they may indirectly cause steel imports from other countries to shift to India, putting pressure on Indian domestic prices.