The Consequences Of Ukraine Vs Russia War On Prices And Demands Of Steel
From February 2022 onwards the tension between Russia and Ukraine has been rising. You will encounter prices of steel products such as stainless steel pipes, stainless steel tubes and, stainless steel kitchenware rising.
Wars are known to harm the economy of the country and countries around the globe. Heavily imbalanced exports and imports also affect relations with neighbouring countries. Causing instability in crude oil prices. while India Imported 43,400 barrels of oil per day from Russia in 2021, yet it consisted of 1 per cent of total imports. India also imports coal, an essential raw material in manufacturing stainless steel requirements from Russia. 85% of India’s coal needs are met while the remaining 15% is fulfilled by Russia.
Both Ukraine and Russia are exporters and manufacturers of stainless steel in addition to being suppliers of raw material namely - coal. Thus the war crisis of mentioned countries can affect the demand-supply & price of stainless steel in the global economy.
Additionally, Russia is one of the largest suppliers of nickel and aluminium. The rising price of the following metals can affect the prices of kitchen appliances, cellphones, electronic items, SS pipes, SS tubes, construction materials, and power generation tools.
Russia and Ukraine together supply 40 million tonne steel in the global markets. Sanctions and restrictions applied on Russia will make it difficult to resume even after the war stops. Indian stainless steel suppliers have fewer worries in their baskets. Iron ore, a main raw material, can be sourced locally. Even leveraging this opportunity SS suppliers can export the steel products to other countries. Local demand for steel has also been catering by these suppliers for new demand coming from the building & construction industry, power plant, pharma, and MSME.
Collectively after the war steel price has been hiked by Rs 14000 per tonne. Thus PM Narendra Modi took a calculative step by banning Iron ore export, imposing a 10% of export duty & withdrawing duties and customs on the import of steel.
The high rise of steel prices has been impacting the cost of bicycle manufacturing where steel pipes are used. In the end, war scenarios could be different. The insurgency can cause instability and businesses do not thrive on instability. As of now, businesses around the world have been waiting to restore stability for continuous growth in the business.