Ruble Decrease Threatens Indian Steel Producers

The decline in the value of the Russian ruble is putting Indian steel companies in a difficult position. Indian steel giants such as Tata Steel Ltd, JSW Steel, as well as Indiahad are planning to increase production, with the support of the central government for faster growth of the country's economy. However, most of the domestic buyers in India prefer Russian alloys over Indian steel products. This situation was observed as a result of the depreciation of the ruble against the dollar last year and may persist this year.

The vice president of JSW Steel in Mumbai said that over the past few months, Russian steel imports have been in high demand in the country's domestic market. He also added that if imports from Russia are not restrained, such purchases will increase.

India's overseas markets, such as the Middle East and many others, favor Russian steel over Indian steel products, putting additional pressure on Indian exporters who are already suffering from an increase in Chinese steel supplies. Russia, the world's largest energy exporter, is currently facing economic difficulties following oil price declines and US and EU sanctions, which continue to weigh on the ruble.

At the same time, the decline in the economy of the world's fifth largest steel exporter in the world will create a favorable situation for Russian steel plants in foreign markets. According to the World Steel Association, the country produced about 69 million tonnes of steel in 2013, of which 34 percent was exported outside the country.