India Steel Demand Falls as Rains Delay Constructions

India’s steel consumption fell for the first time this fiscal year in November after late rains delayed construction activity.

Consumption fell 5 percent last month from a year earlier, G.K. Basak, executive secretary of the steel ministry’s joint plant committee, said in a phone interview. Imports tumbled 62 percent, he said without giving the figures.

India had 17 percent more post-monsoon rains in October and November than the average for those two months over the past 50 years, according to the weather department. This was the highest level in six years. Construction activity either stops or slows during the rains.

“The drop in consumption came as a surprise.” said A. S. Firoz, chief economist at the Ministry of Steel. “A slowdown in construction activity because of prolonged rains in the country led to this fall.”

Overall consumption this fiscal year may still grow by 10 percent mainly on higher demand from the automobile sector and a recovery in sales to the construction industry, Basak said.