In Second Half of June Hydrogen prices in India remained stable, following a modest increase earlier in the month. The market held firm amid stable production costs, uninterrupted natural gas supply, and consistent demand from key sectors such as fertilizers, DRI-based steel, and refineries. While refinery hydrogen demand remained muted due to lower diesel and ATF exports, fertilizer and industrial sectors sustained regular offtake. LNG imports and domestic gas output declined year-on-year, but overall availability remained sufficient. Green hydrogen development stayed slow, with delays in VGF and PLI execution limiting its impact on market prices.
Indian Hydrogen prices stayed flat during June 2025, after a minor rise in the first half of the month. The market-preserved balance, buoyed by stable production costs, firm demand from major sectors, and uninterrupted availability of feedstocks. Industrial purchasers and traders maintained a prudent approach, looking for required volumes in the face of uncertain downstream strength.
India鈥檚 gross natural gas production for May 2025, which shaped June鈥檚 Hydrogen supply, stood at 2,979 MMSCM鈥攄own 4.0% from the same period last year. Net production for sale after internal usage and flaring was about 83.9% of this amount. At the same time, LNG imports decreased by 15.3% YoY to 2,977 MMSCM from which overall 10.2% less gas was available for sale in comparison to last year's corresponding period. Total availability of consumption gas, nonetheless, increased to 5,918 MMSCM and was enough to provide supply to downstream segments.
The fertilizer sector was the largest consumer of natural gas in May with a share of 26% of overall demand, followed by city gas distribution (23%), power generation (14%), refineries (8%), and petrochemicals (6%). Hydrogen producers in Dahej, Mumbai, and other key clusters operated smoothly, backed by consistent natural gas supply from ONGC and OIL. Input gas prices remained unchanged at USD 6.41/MMBTU (GCV) for June, ensuring stable production economics.
Demand for Hydrogen from the refining industry was also moderate, with total refinery utilization remaining short of its peak level. While April crude runs represented 91% of the 21.5 MMT run, an 12.4% YoY fall in diesel and ATF exports cut the demand for Hydrogen for hydrocracking as well as desulfurization processes. This restricted refinery-based Hydrogen demand to low levels and kept major price movements at bay.
Fertilizer manufacturers sustained regular Hydrogen procurement, fuelled by seasonal agricultural demands. Steel manufacturers based on DRI also sustained normal offtake, though they refrained from bulk procurement in the face of sustained margin squeezes. Overall industrial consumption remained disciplined, with all buyers dependent on contract-based procurement, shunning spot market exposure.
Green Hydrogen development was slow on the uptake even as industry interest was high. Project implementation continued to be delayed owing to pending Viability Gap Funding (VGF) and Production Linked Incentive (PLI) release issues. Green Hydrogen did not have much influence on traditional Hydrogen prices during the month as a result.
With no significant disruptions in gas logistics or supply, and stable demand from downstream industries, Hydrogen prices are likely to remain firm through July. The short-term outlook is neutral, depending on refinery operations upside, fertilizer production trend directions, and green Hydrogen policy directionality.
