How Steel Sector Is Coping With The Global Pandemic: An Industry Research
The Coronavirus pandemic has kept the entire world on its toes, and many industrial sectors felt the heat of it. The pandemic impacted the global economy so badly that many countries took the vicious path by going for a complete lockdown, even though they knew this would backfire on them. During this period, the global steel industry was staring at an empty abyss. This phase also saw many of the steel industries experiencing closure of operations, and many of them were forced to cut down their operations by 50 percent. The Indian scenario was no different, with further decline in the demand for the year 2020-21.
What experts’ predict
According to experts, the steel demand for the FY 2020-21 might fall by almost 15%. This will lead to a downfall in prices, oversupply and rising inventories. The domestic market has already faced a big fall, and this forced many major steel producers to look into the export markets to sell their products as the demand was very low.
Even after the lockdown was lifted, the steel industry continued to confront various challenges, and this included hampered logistics and labour shortage. The biggest hurdle that the steel industry faced during the pandemic was the complete collapse of demand from various industries, including the automobile sector.
Glimmer of hope
However, recoveries are very much visible in the market since May, as the government slowly lifted up the lockdown and the entire nation and whole world entered into the phase of unlocking. During this phase, the domestic steel market was able to recover from the disruptions caused by the pandemic. Many of the steel companies across India started running on full capacity, thanks to slow, but steady growth in demand.
Limping back to normalcy
According to a report from the Ministry Of Steel, the domestic steel industry has already started showing signs of improvement since June compared to April, when the entire nation faced the lockdown. During June, the country’s steel manufacturers were able to produce 6.8 million tonnes of steel, that is 17.7 per cent higher than compared to May 2020. If we look closely, many steel industries have taken preventive measures to minimize the impact on production.
The way forward
As countries limp back into the resumption of economic activity, many organizations across the world are gradually flattening the recession curve by leveraging technology, including with the help from digital platforms. With the continuing spread of Covid-19, building business resilience will help many companies to move forward in their journey from the Covid crisis and head towards the new normal.