India: Stainless steel scrap imports fall 20% m-o-m in Jan'26 as mills pivot to domestic scrap and semis

• Higher slab inflows from Indonesia reshape raw material mix
  
  
• Domestic scrap undercuts imported material by INR 7,000-8,000/t
  
  
• Domestic stainless steel production rises 17% m-o-m in Jan'26
  
  

Morning Brief: India's stainless steel scrap imports declined significantly in January 2026 as compared to December 2025. Total stainless steel scrap imports stood at 94,000 t, down 20% from December's 116,956 t, as per BigMint data.

Series and grade-wise imports

Data reveals that 300 series scrap dominated the market, accounting for 58,500 t in January, a significant drop of 23% from the previous month's 75,700 t. Imports of 200 series decreased by 17% to 11,800 t. 400 series scrap imports fell by 20% to 14,000 t.

Grade-wise, 304 grade scrap imports dropped by 35% to 27,000 t, while zurik dropped by 12% to 22,500 t. 316 grade scrap imports declined by 3% to 8,000 t. Imports of the 430 and 201 grades also witnessed a significant drop.

Country-wise imports

The United States remained a key supplier, but imports declined by 15% to 14,000 t. Vietnam and Thailand recorded a significant drop 21% and 48% respectively, as Indian buyers sought to diversify their sourcing and capitalise on competitive offers. Imports from Malaysia and Thailand also dropped in January.

Key updates

Cost arbitrage favours domestic scrap: The key driver was pricing. Domestic 304 scrap averaged around INR 111,000/t in January, whereas imported 304 scrap stood near $1,265/t CFR. After accounting for exchange rate and logistics, imported material was costlier by roughly INR 7,000-8,000/t, prompting mills to prioritise domestic procurement and short-sea sourcing.

Higher slab inflows reshape raw material mix: Stainless semi-finished imports rose 11% m-o-m to 56,004 t in January led by slab inflows of 55,104 t-entirely from Indonesia. Integrated nickel and NPI availability enabled Indonesian suppliers to offer cost-competitive slabs, reducing the need for scrap-intensive melting. Billet imports increased marginally to 900 t.

Lower 300-series share weighs on imports: In its Q3FY'26 earnings commentary, Jindal Stainless indicated an ~4% q-o-q drop in 300-series share. As 304 and 316 scrap demand is directly linked to nickel-bearing production, this moderation curtailed import requirements.

Production rises despite lower scrap imports

India's stainless steel output increased 17% m-o-m to 0.4 mnt in January, with flats up 11% to 0.27 mnt and longs rising 32% to 0.13 mnt, underscoring the shift toward slab-led production rather than scrap-heavy melting.

LME nickel price trends

LME nickel prices strengthened sharply in January, averaging $18,000/t, up 20% from $15,000/t in December. The rally was driven by growing concerns over Indonesia's ability to meet rising ore demand amid discussions to reduce its 2026 nickel ore production quota to around 250 million WMT (wet metric tonnes) from 379 million WMT targeted for 2025. The firm nickel trend influenced stainless steel scrap sentiment globally, although in India, higher imported scrap costs limited buying interest despite the bullish upstream cues.

Outlook

Stainless steel scrap imports are likely to trend upward in the coming months, supported by improved currency dynamics and evolving raw material fundamentals.

While the dollar peaked in January and eased in February, softer currency pressure could make import bookings relatively more viable.

At the same time, Indonesia's tighter NPI-linked ore quotas may constrain primary nickel feed availability, indirectly strengthening scrap's role in the melt mix.

Although domestic scrap generation remains stable, it may not fully meet mills' blended raw material requirements, necessitating calibrated import dependence.