Steel consumption grew by a mere 1.8 per cent in the first six months of current financial year on poor off-take from key sectors such as construction and automobile.

The latest Steel Ministry estimates reveal that consumption stood at 33.70 million tonnes in first half of fiscal 2012 as against 33.10 million tonnes in corresponding period in the previous fiscal.

However, production of finished steel grew 9.3 per cent to 34.79 million tonnes as against 31.82 million tonnes. Output of main producers including SAIL, Tata Steel and RINL grew 2.9 per cent to 8.95 million tonnes (8.69 mt in H1 FY11).

Total output of other major producers including JSW Steel, Essar Steel and Jindal Steel and Power Ltd grew 8.3 per cent to 9.6 mt (8.9 mt). Steel imports for the period were down 36.4 per cent to 2.85 mt (4.49 mt), whereas exports grew by 46 per cent to 2.15 mt (1.47 mt).

Production of pig iron was almost flat at 2.83 mt, while consumption fell by 4.3 per cent to 2.56 mt as (2.68 mt). Traditionally, consumption of steel slows down during the monsoons. The industry expects the demand to pick up from later this month.

The World Steel Association (WSA) in its recent short-term outlook pared the demand projections in view of the weak economic condition. WSA now expects India's steel consumption to grow at 4.3 per cent to 67.7 mt in 2011 as against the earlier growth projections of 13.3 per cent.