The global and Indian metal sectors are capital-intensive, highly cyclical industries driven by infrastructure demand, manufacturing activity, and commodity price fluctuations. As of 2025-2026, the industry is transitioning toward green steel and base metals (copper, aluminum) to meet sustainability goals, with India’s steel production capacity expected to reach 300 MT by 2030. While oversupply from China persists, demand for green metals is a key growth driver, despite high capital costs. 

Key Sector Highlights & Trends (2025-2026)

• Production & Demand: Indian crude steel production in early FY26 grew by 12.4%. Driven by infrastructure and construction, India’s finished steel consumption reached 150.23 MT in FY25.
• Green Shift: Green steel demand is projected to rise from low levels to 4.49 MT by FY30, reaching 179 MT by FY50, driven by sustainability initiatives.
• Cyclicality & Risks: The sector is characterized by intense, decade-long cycles, significant debt, and high sensitivity to global economic conditions, tariffs, and raw material costs.
• Pricing Outlook: While iron ore and steel prices may face stagnation due to Chinese overcapacity, industrial metal prices (copper, aluminum) are expected to strengthen due to supply constraints.
• Investment: The Indian metallurgical industry allows 100% FDI via the automatic route, with significant investments in upgrading capacity. 

Structural Challenges

• China Factor: Massive oversupply from China pressures global prices, a factor expected to limit growth in 2026.
• Decarbonization Costs: Shifting to green technologies requires heavy investment in electric arc furnaces.
• Energy Intensity: The industry is energy-intensive, making it vulnerable to energy price volatility.