India's Ministry of Steel released year-2 cumulative numbers on the Production Linked Incentive scheme for specialty steel in late 2025. Cumulative approved capacity stands at about 26 million tonnes across the five eligible product groups, with the disbursement trigger now active for several recipient producers who have crossed the 100-day sustained-production threshold at the committed grade tier.
The headline volume number understates the upstream signal. The PLI scheme is grade-specific, not tonnage-specific — the incentive is structured so that producers earn the payout only on the specific high-grade categories India was previously importing. That grade-mix tilt is what matters for the ferro-alloy supply chain.
The grade mix being incentivised
The eligible product groups under specialty steel PLI include coated and plated steel products, high-strength wear-resistant steel, specialty rails, alloy steel products and steel wires, and electrical steel — the high-grain-oriented sub-category. Buried inside the alloy-steel products group are titanium-stabilised austenitic grades (the 321 and 316Ti families), the ferritic 444 grade used in EV battery housings, and the aerospace-grade alloys that have historically been imported.
Year-2 disbursement data shows the alloy-steel and electrical-steel groups together accounting for the bulk of incentive-eligible production. That is the same pair of grade families that consumes the highest ferro titanium addition per tonne of finished steel.
Why this changes the ferro-alloy contract structure
Specialty stainless contracts written in the second half of 2025 increasingly carry clauses around batch traceability, grade-discipline tolerances, and lead-time guarantees that go well beyond what commodity-grade FeTi contracting required two years ago. Producers running rolling supply to PLI-recipient customers have started seeing audit cycles overlap with batch acceptance — a meaningful operational change.
For producers operating to ISO 9001:2015 with mature batch-COA practice, the audit overlap is manageable. For spot-supply operators it is a meaningful compliance lift.
What the next two years should look like
On the demand side, PLI-driven specialty stainless output is expected to ramp through 2026 and 2027 as production lines reach steady-state operation. The implied Ferro Titanium consumption growth is in the high single digits, well above the 5.3% global CAGR forecast.
On the supply side, Indian producers that hold 400 to 500 MT of titanium scrap inventory and run the full 30 percent to 75 percent Ti grade range continue to be structurally positioned for this regime. The producers competing on commodity-grade spot pricing are likely to find their order book mix shifting away from PLI-tied customers over time.