Sponge iron industry gains on double-digit drop in FY20 steel imports

Lower scrap imports could pave way for vehicle scrap policy

The double-digit drop in India’s FY20 steel imports has augured well for the domestic sponge iron industry, which saw a 7 per cent rise in its production.

"Since sponge iron is used as an alternate to steel scrap in several consumption segments, a drop in scrap imports last year helped domestic sponge iron industry benefit,” M Chinnasami, director at Tamil Nadu-based sponge unit company Agni Steels Limited told Business Standard.

According to the Joint Plant Committee data, the country’s steel imports declined 14 per cent last year to 6.7 million tonne. Whereas, on the other hand, the domestic sponge iron