India: Stainless steel scrap imports to rise 7% in FY'26 on expanding domestic capacity, stronger 300-series demand

• 300-series continues to dominate import basket
  
  
• Domestic stainless steel expansion supports scrap demand
  
  
• Lower ferro nickel imports signal shift towards scrap-based melting
  
  

Morning Brief: India's stainless steel scrap imports are projected to rise by 7% in FY'26 (April'25-March'26) as compared to the last financial year. Import volumes are estimated at 1.4 mnt as compared to 1.3 mnt in FY'25.

Series & grade-wise imports

Among major grades, 304 scrap imports are expected to increase 9% y-o-y to around 0.53 mnt, while 316-grade imports are projected to rise 2% to nearly 0.12 mnt amid elevated molybdenum prices and tighter availability of prime material globally. Imports of Zurik are estimated to increase 6% to 0.28 mnt, supported by strong secondary stainless steel melting activity.

Meanwhile, 200-series scrap imports are expected to remain largely stable at around 0.13 mnt, as competitive imports of finished material and pressure on low-nickel stainless steel margins may restrict aggressive buying activity.

In contrast, 400-series scrap imports are projected to decline 7% y-o-y to around 0.17 mnt. Imports of 430-grade scrap are expected to fall sharply by 16% to nearly 0.11 mnt amid softer demand from utensil and white goods segments and increased availability of domestic substitutes.

Vietnam, South Korea emerge as key suppliers

The US remained India's largest stainless steel scrap supplier during FY'26, with shipments estimated at around 0.19 mnt, largely stable y-o-y. However, Asian suppliers witnessed significantly stronger growth as Indian buyers diversified sourcing to secure competitive cargoes amid volatile freight and alloy markets.

Vietnam emerged as one of the fastest-growing suppliers, with shipments increasing sharply to around 0.18 mnt in FY'26 compared with nearly 0.11 mnt in FY'25. South Korean exports also rose significantly to around 0.18 mnt, compared with only 28,000 t last year, reflecting stronger regional scrap availability and competitive offers into India.

Thailand's shipments remained broadly stable at around 0.11 mnt, while additional volumes were sourced from Malaysia, Saudi Arabia, the UAE, and other Southeast Asian origins as buyers expanded procurement channels to manage supply risks.

Market sources indicated that geopolitical uncertainties, freight fluctuations, and tightening availability in Western markets encouraged Indian importers to increasingly focus on Asian-origin cargoes during the year.

Factors driving imports

Increased domestic SS production: India's finished stainless steel production increased 12% y-o-y to around 4.44 mnt in FY'26 from around 3.9 mnt in FY'25, driven by stronger demand from infrastructure, railways, process industries, pipes and tubes, and export-oriented manufacturing sectors. This naturally drove the demand for scrap input.

Competitive import economics support buying: Despite higher freight and port handling expenses, imported 304 stainless steel scrap remained commercially viable during FY'26. On average, imported 304 scrap prices were assessed at around $1,280-$1,285/t CFR Mundra, which translated to nearly INR 117,000-117,500/t after including port clearance and related charges. In comparison, domestic 304 scrap prices averaged around INR 113,000-113,500/t DAP Delhi.

Market participants noted that imported scrap continued to attract buyers due to better material quality, bulk availability, and stable supply consistency, particularly for large stainless steel producers.

Decline in imports of semis: Stainless steel billet imports into India declined sharply by 49% y-o-y to around 59,000 t in FY'26, compared with nearly 110,000 t last year. Indonesia remained the sole major supplier of slabs and billets to India.

Drop in ferro nickel & NPI imports: Imports of ferro nickel are estimated to decline significantly during FY'26, falling 47% y-o-y to around 0.11 mnt compared with 0.21 mnt in FY'25. Indonesia is expected to continue dominating shipments, accounting for nearly 0.10 mnt, although volumes are projected to decline 45% y-o-y from around 0.20 mnt last year. Meanwhile, NPI imports into India are estimated at around 0.13 mnt during the year.

Industry participants believe that elevated Indonesian ore prices, tighter RKAB approvals, revised HPM pricing mechanisms, and rising energy costs have reduced the competitiveness of imported ferro nickel and NPI, encouraging mills to increasingly rely on stainless steel scrap.

Outlook

India's stainless steel scrap imports are expected to remain firm in the near term, supported by continued expansion in domestic stainless steel capacity, healthy demand from the 300-series segment, and increasing preference for scrap-based melting amid volatile alloy markets.

However, procurement strategies are likely to remain cautious due to fluctuations in LME nickel prices, freight volatility, geopolitical developments, and evolving Indonesian nickel policies. Buyers are also expected to continue diversifying sourcing origins to maintain supply stability and manage raw material costs more effectively.