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Stainless sector awaits growth

The latest economic data from the European Commission shows a modest 0.3% GDP growth in the first quarter of 2024, marking the first sign of economic improvement since the end of 2022. Despite this, Joost van Kleef, chairman of the BIR’s stainless steel and special alloys committee, highlights that the recovery in the stainless steel segment is still forthcoming. In the BIR Mirror’s latest sector report, van Kleef notes that European stainless steel use and production have significantly reduced, with crude stainless steel output declining by over 6% last year to 5.9 million tonnes, despite the usual seasonal improvement in the fourth quarter.

Van Kleef elaborates that the year began stronger than expected due to an uptick in seasonal demand for stainless steel, alongside historically low import levels. However, European scrap availability remained hampered by ongoing weakness in industrial and manufacturing activities. The first two months of the year saw the EU increase net imports of stainless scrap from third countries by more than 50% compared to the same period in 2023.

Ritesh Maheshwari from Shabro International adds that new Bureau of Indian Standards certification requirements for ferro-nickel are affecting imports, likely driving a shift towards more stainless steel scrap imports. Concurrently, Jindal Stainless has announced a significant investment of $650 million (EUR 600 million) to expand both downstream and upstream capacities. This includes a joint venture to develop a stainless steel melt shop in Indonesia with an annual production capacity of 1.2 million tonnes, boosting Jindal’s total capacity to 4.2 million tonnes. Additionally, Jindal is enhancing its downstream lines in Jajpur and acquiring a 54% equity stake in Chromeni Steels, which operates a cold rolling mill in Mundra with a 0.6 million tonnes per annum capacity.

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