India’s steel exports (including stainless steel) surged 36% year-over-year to 7.65 million MT in the first 10 months of FY26 (April 2025-January 2026), demonstrating the resilience and competitiveness of India’s steel industry. The export surge was primarily driven by EU demand frontloading ahead of the Carbon Border Adjustment Mechanism (CBAM) implementation.
## Key Developments
**36% YoY Export Growth to 7.65 Million MT**
In the first 10 months of FY26 (April 2025-January 2026), total steel exports reached 7.65 million MT, representing 36% YoY growth compared to ~5.6 million MT in the same period FY25. Monthly exports exceeded 700,000 MT consistently from August 2025 onwards, with December 2025 exports surpassing 1 million MT in a single month.
**EU Frontloading Driven Growth**
The primary export driver has been EU demand acceleration, with importers stockpiling ahead of CBAM implementation in January 2026. Uncertainty over carbon cost implications has driven accelerated purchasing, with Indian mills offering competitive prices.
**Export Market Diversification**
Export destinations are showing strategic shifts, with Europe remaining the largest market but facing CBAM headwinds. Vietnam has emerged as a major destination after anti-dumping duty exemption, while Africa represents an alternative market as European access becomes uncertain.
**HRC Quota Exhaustion**
EU’s quarterly HRC quota for Q3 FY26 (Oct-Dec 2025) of 227,782 MT was exhausted by end of November, with high volume shipments clearing through early 2026.
## Background Context
**Carbon Border Adjustment Mechanism (CBAM)**
The EU’s CBAM entered its definitive phase on January 1, 2026, imposing carbon taxes on steel, aluminum, cement, and hydrogen imports. Indian blast furnace steel faces €269.78/ton carbon charge under default values.
**Global Steel Supply-Demand Balance**
Global crude steel capacity is rising faster than demand, intensifying competition among traditional exporters as India gains market share through price competitiveness.
## Strategic Opportunities
**Green Steel Transition**
Indian steelmakers should prioritize investment in hydrogen-based steelmaking and integration of renewable energy in steel production.
**Value Addition & Specialty Steel**
Moving up the value chain through high-strength, low-alloy steel development and direct sales to OEMs rather than commodity trading.
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