Delayed European recovery, Chinese dumping hurting margins: Jindal Stainless chief

Despite domestic demand for stainless steel, margins in the fourth quarter of the current financial year may be under stress primarily due to dumping by the Chinese, says Abhyuday Jindal, Managing Director of the country’s largest stainless steel maker. 

Europe demand is yet to rebound, while the Red Sea geopolitical crisis has pushed up freight rates, impacting US demand. 

In an interview with businessline, Jindal discusses global economic conditions, margin pressure, impact of Carbon Border Adjustment Mechanism (CBAM), and the company’s investment in renewables. Edited excerpts:

What is the outlook for Q4? 

Domestic demand (for stainless steel) is still very strong. But the challenge, as usual, is the import and dumping that is happening from China. 

Export has still not picked up as expected. (Demand in) Europe remains subdued. There has been a pick-up in the US but freight rates have gone up, so the margins and demand are not as anticipated. So exports will require a little more push. 

In what way can exports be given a push? 

It is mostly at the G2G [government-to-government] level, with issues like CBAM being looked into. More so, we are waiting for the European economy ro rebound, and the wars and geopolitical situations to subside or stabilise. This would help exports. 

Wasn’t the European economy expected to rebound around January to March? 

Yes it was. But that has not happened. So we are hoping for a rebound in the next couple of quarters. But again, there is no clarity on that. However, customers are giving us orders, which we are carrying out. 

Margins are under pressure only because of the dumping happening in India. 

The new default values for embedded carbon emissions under CBAM are out. Your comments. 

It is still too early to analyse the impact. It’s only in 2026 when the carbon tax or levy comes into play. Right now there is a lot of confusion on the (CBAM) rules. For instance, in Europe they have gone back to conventional energy resources. So we need to see how they will justify that usage and in what manner they calculate the use of such resources. 

Is Jindal Stainless readying to align itself to CBAM requirements? 

As an organisation we are keeping ourselves absolutely ready. Whenever the impact comes, be it in 2026 or so, we are ready with the processes and reporting. Data have been generated. And submitted. We have also signed up with all the requisite authorities approved by the EU to monitor the carbon emissions at our plants. 

Any investment towards renewables or to reduce carbon footprint? 

We have worked out a ₹700-crore investment plan across a three-year period, and through various projects that include round-the-clock availability of renewable power, investing in green hydrogen — one project has been commissioned in Hisar — to make stainless steel, and so on. Investment would be from internal accruals. Investments are underway. Over the years, we replace all our energy requirements through renewables. 

Our plan continues to be to reduce our carbon emissions by 50 per cent by 2035.

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