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Steel production to touch 55.5 MT during FY 2008

By Staff
Google Oneindia News

New Delhi, Dec 31 (UNI) Led by robust domestic demand, the steel sector in the country has been witnessing extraordinary growth, making India the fifth largest crude steel producer in the world, as against eighth position held three years back.

The production of finished carbon has increased from 35.41 Million Tonnes (MT) in 2002-03 to 49.58 MT in 2006 -07. During the first seven months of the current year from April to October 07, production of finished carbon is estimated to be about 29.37 MT and is expected to be 55.5 MT in FY 08.

The exports have however remained fairly stable between 2002-03 until last year at around 4.5 MT, imports have increased from 1.51 MT in 2002-03 to 4.10 MT maintaining a rising trend this year, largely to fill the demand supply gap in the domestic market.

The demand for steel is expected to remain buoyant, above 10 per cent over the next five years, and in the most likely scenario, the steel production capacity in the country is expected to touch 124 MT by 2012. While the brownfield expansion plan over the next five years is expected to add 40.5 MT capacity to the existing capacity of 56.84 MT, the most likely scenario for addition to capacity by setting up of greenfield projects is expected to be 28.72 MT taking the total capacity to 124.06 MT.

Furthermore, taking into consideration the intentions expressed by various steel investors including multinationals, domestic steel majors and FDIs, the likely capacity achievable by 2019-20 will be around 275 million tonnes.

The Public Sector Undertakings, Steel Authority of India Limited (SAIL) and Rashtriya Ispat Nigam Limited (RINL), are in the midst of ambitious expansion plans. The expansion plan would increase the capacity of SAIL from 14.6 MT of hot metal to 26 MT by 2010 at an estimated cost of around Rs 53,000 crore.

SAIL is also planning to expand its capacity further to 60 MT per annum by 2020. In case of RINL, the expansion would increase its capacity from the present level of 3 MT of hot metal to 6.3 MT by 2009-10 at an estimated cost of around Rs 9,000 crore. RINL also plans to enhance capacity to 16 MT per annum by 2020.

An MOU was signed between SAIL, RINL and NMDC this year for setting up a 4 MT steel plant in Chhattisgarh. MECON has been appointed as consultant to prepare the site selection and economic feasibility report by April 2008.

In a major move for implementing the project a tripartite MOU was signed between the Railway Ministry, Chhatisgarh Government and SAIL and NMDC for laying a 235 kilometer railway link between Dalli-Rajhara and Rowghat and further to Jagdalpur.

Acquisition of coking coal mines, in the wake of major expansion/investment plan, securing raw materials has been a major concern. By 2020, about 70 MT of coking coal will be required of which 85 per cent will have to be imported.


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