Today, the steel industry is contributing slightly more than 2% to the GDP. This accounts that the direct & indirect contribution of steel is much crucial for the dependence of other sectors. The steel industry has nearly more than 2 million people working on critical processes for steel production. The output, the World Steel Association, stated that for every two jobs created in the steel industry, 13 more jobs get created across the supply chain.
India is the world’s second-largest producer of crude steel, with nearly 110.92 MT produced in 2018–19. It has strengthened its domestic steel industry drastically over the last decade. India became a net exporter with exports of total finished steel reaching 8.24 MT vis-à-vis imports of 7.22 MT in the exact same year & for the years to come. But with rising protectionism and an ongoing trade war (among other factors), and India being shut due to the pandemic there has seen a steep decrease in its exports, and imports. To attain a positive trade balance from finished steel production was looks like a missed opportunity to build a mature secondary sector. The current global economic downturn and structural changes in many related industries have arrested any upward trend, at least for the time to come.
Today’s markets is characterized by complexity, ambiguity and uncertainty. Fluctuating prices of oil, raw material and currency exchange rates all have impacted the profitability equation. Investing in new production and product technology, manufacturing companies may lead to market volatility, price reduction pressures and increasing material costs. Companies should therefore be focusing more on-demand responsiveness, annual cost reductions and supply chain performance. Smaller firms should be focusing on strengthening customer relationships, improving productivity and quality. In the case of a manufacturing company should make its operations lean and agile to stay intact in this ever-changing market demand.
Top Market Challenges right now are Market volatility, Material costs, Price reduction pressures, Labor costs, Transportation/logistics costs & Environmental laws and regulations. Manufacturers of all sizes need to divert their focus on improving production processes, strengthening customer relationships and finding better employees. They must pay more attention to meeting customization demands and improving productivity.
Usage of alternate reusable or inexhaustible sources is also very crucial at this point in time. Batteries, for example, are now being used in electric cars, trucks and even trains, as well as thousands of other products that are making the transition to more efficient and eco-friendly ways of operating. These are available to buy in bulk through export or import and are quality assured by their trusted status in the market. Batteries can be the future – so investing in them can give steal a march on your competitors.
The same could be said for Solar Panels or Wind Turbines. Its invention has led to the adoption of green policies across the world. With policies aiming to phase out fossil fuel power, wind turbines and solar panels are adequately built to incorporate sustainable energy sources for the future. As Steel and manufacturing units are considered to be asset-intensive. Transformation is essential with the evolution to increase the efficiency of the whole system. It will also reduce cost and increase profitability across the industry.
The digital disruption seems to have just begun and is set to grow exponentially in the coming years. The right adoption of emerging technologies is a critical factor for success in times to come. With the right knowledge in hand and its application, it’s crucial to consider carbon-offsetting and carbon-neutral technologies. Such information should give an insight about now or beyond.