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EDITORIAL Dear Readers,

T

he steel sector has been at the receiving end for some time now. Adding to the negative sentiment, analysts warn there could be more downside to earnings due to slack demand. Euro zone debt crisis, subdued domestic demand, decreasing prices, rising input costs, CAG report on coal and delays in obtaining procedural clearances for mines are some of the factors to put the blame on. Internationally, demand for steel in key markets, including Europe, the US and China, is heading south. The situation in Chinese markets, the largest consumer of the metal, is considered to be worse than in 2008-09. According to the latest data, world steel production growth came down to just 1-2 percent in recent months and capacity utilisation is at around 79 percent. Rating agency Fitch in its outlook for steel producers said it expects steel demand growth to be in the range of 6 to 7 percent for the remaining months of the year (2012). Companies have already started cutting production. With demand outlook remaining subdued for the near term, both in the domestic and international markets, pressure is mounting on the prices. In India, steel prices have seen a correction of about 10-12 percent since May 2012. However, due to less production especially in China – which accounts for 60 percent of raw material demand – the prices of coking coal and iron ore have corrected in the international market. This should help on the margin front, albeit marginally given the rupee’s depreciation. However, fixed (interest) costs will remain firm, which in a scenario of muted top line growth would lead to pressure on the bottom line. Meanwhile, the gains from decline in input costs would be negligible for non-integrated players like JSW Steel. Analysts downgraded the stock also due to the merger of JSW Ispat with JSW Steel as they termed it as EPS and value dilutive to JSW Steel. For Tata Steel, the decline in raw material prices will not significantly impact its business as lower steel prices and demand in the international market will hurt its global operations (which contribute 65 percent of the group’s business). SAIL, which is largely present in the Indian market, is also feeling the heat due to slowing domestic demand and lower steel prices. For instance, in the first quarter, SAIL produced three million tons (mt) of steel and sold only 2.5 mt. However, there is good news at the end of the tunnel. The Supreme Court has granted permission for restart of operations at 18 iron ore mines in Karnataka. Ore output from these mines would average some 4-5 million tons per year. This would be in addition to the 1 million tons per month that NMDC has been asked by the court to produce since August 2011. In the midst of it all, we at Steel Insights tried to find out how iron ore can be judiciously and optimally utilised at a time when India is under severe criticism for its handling of critical natural resources like coal. The edition also carries a brief update on refractory sector in the special focus section. Happy reading!

Disclaimer: This document is for information purpose only. Certain information herein has been acquired from various external sources believed to be reliable. While we have taken reasonable care to compile this report, we in no way assume any responsibility for any error or discrepancy in regards to information contained herein. Readers are requested to make appropriate judgment without any prejudice or compulsion.

(Rakesh Dubey) Steel Insights, September 2012

3


Contents 28 iMax targets Rs 100 million revenue in 2012-13 34 A new chapter begins with JSW IspatJSW Steel merger 38 Uttam Galva group to buy out Lloyds Steel 40 RINL signs MoU with PowerGrid for electrical steel 42 Essar Steel secures pipe orders from Middle East, Africa 44 Danieli develops mini PLTCM to produce CR strips 51 Steel Ministry asks SAIL to raise performance bar 53 Ferro alloy makers in West Bengal seek power benefits 55 Spot coking coal prices ease sharply in August 56 Auto sector growth slows down 58 April-July steel imports up 53% y-o-y 59 Ferro alloy prices show marginal uptrend 60 ISMW welcomes reopening of ore mines, denounces illegal mining 61 Iron ore handling by major ports down 35.8% y-o-y in April-July 62 Railways commodity freight revenue down m-o-m in July 64 Macroeconomic indicators of India 66 Global crude steel production up 1.68% in July 68 Domestic flat & long markets 72 Domestic raw materials market 74 Production data 75 Ferro alloys & metals price trends 76 Iron ore export data

4 Steel Insights, September 2012

6  |  Cover Story

Can India judiciously use iron ore?

22  |  Special focus

A proper roadmap is needed for optimal utilisation of iron ore in which India has competitive edge

Refractories sector needs innovative cost-cutting

Innovations in reducing costs and withstanding competition from competitive material is need of hour

30  |  Interview

Material handling industry to grow at 20% for next 5 years The size of Indian industry is estimated around `5000 crore, says Bevcon’s MD

36  |  Corporate

JSPL gears up to reduce DRI production cost As a primary measure company is using pellets instead of iron ore fines resulting in coal consumption

50  |  FEATURE

NMDC hikes prices as supply constraints continue Prices were hiked by 8-13% for Jul-Sept period to cash in on demand supply mismatch


Cover Story

I

Can India judiciously use iron ore? Tamajit Pain & Arindam Bandyopadhyay

ndia’s natural resource management has of late been under severe criticism and scanning…be it the Comptroller and Auditor General’s (CAG) report on coal block allocation or the rampant mining of iron ore in an allegedly illegal and destructive manner. In case of iron ore, the prime steel making raw material, the problem started on July 26, 2010. On that day the Supreme Court imposed a ban on ore mining in the Bellary, Tumkur and Chitradurga districts of Karnataka to prevent environmental degradation allegedly caused by illegal mining in those areas. The court also directed Central Empowered Committee (CEC) to submit a report reviewing India’s iron ore requirements and supply of ore from Karnataka. Later, following an elaborate process of inspection and introspection about 44 mines were placed as category “A” mines. These mines, according to CEC, have not committed any irregularities whatsoever. Industry body Federation of Indian Mineral Industries (FIMI) also submitted verification reports for some of the selected mines of category “A” and suggested ways for mining in a “corruption free manner”.

When the well’s dry, we know the worth of water. Benjamin Franklin, (1706-1790), Poor Richard’s Almanac

6 Steel Insights, September 2012


Cover Story This finally led to the Supreme Court order of reopening of 18 iron ore mines in Karnataka after a gap of two years. However, analysts and industry experts are certain that not more than 5 million tons (mt) of ore could be mined from Karnataka this financial year (2012-13). This is over and above the 1 mt per month that is mined by NMDC from the region. Reports on all 44 companies with category “A� mines would be submitted in two or three months to the Indian Council of Forestry Research and Education, which has been entrusted by the Supreme Court to prepare Resettlement and Rehabilitation plans in the mined areas.

Meanwhile, during the last two years, the Central government has been trying to curb ore exports from the country to preserve the raw material for future domestic consumption. This is important as the domestic steel capacity is set to increase by another 40-50 million tons per annum (mtpa) over the next five years. To discourage export of iron ore and to improve availability of iron ore for the domestic iron and steel industry at affordable price, the government has increased the export duty on iron ore from 20 percent ad valorem to 30 percent ad valorem on all grades of iron ore (except pellets) with effect from December 30, 2011.

This has led to gradual shrinkage of exports in the last two years and an increase in domestic consumption. The production of iron ore in the country during the year 2011-12 was 169.66 mt (provisional) as against the total estimated consumption of about 116.3 mt by the domestic iron and steel industry. Export of ore stood at about 61.8 mt. According to rough estimates, about 31 percent of the total production of iron ore was shared by public sector companies like SAIL and the share of the private sector was 69 percent. The total production of iron ore included 50 mt by captive miners and the rest by merchant miners. The exports mostly find

Projected crude steel capacity year-wise till terminal year of the XIIth Plan State SAIL Vizag Steel Plant (RINL)

Andhra Pradesh

NMDC Nagarnar

Chhattisgarh

Tata Steel, Jamshedpur

Jharkhand

Tata Steel, Kalinganagar

Orissa

2010-11

2011-12

2012-13

2013-14

2014-15

2015-16

2016-17

12.84

13

15.27

20.75

20.75

20.75

20.75

2.82

2.82

6

6

7

7

7

2

3

3

6.8

7.62

9.22

10

10

10

10

1

3.05

5.5

6

JSW Vijayanagar

Karnataka

6.8

8.93

10

10

10

12

12

ESSAR Steel

Gujarat

4.6

6.3

8.5

8.5

9

10

10

JSPL Raigarh

Chhattisgarh

2.4

3

3

3.5

4

4

4

5.2

5.2

JSPL Angul

Orissa

1.5

2

2

3

4

ElectroSteel Steel Limited, Siyaljori Bokaro

Jharkhand

1.7

2.2

2.2

2.2

2.2

Bhushan Steel Limited Angul-Dhenkanal

Orissa

1.5

2.3

2.3

4

5.2

Jindal Stainless

Orissa

0.6

0.8

0.8

0.8

0.8

37.91

39.79

41.77

43.85

1

1

1.6

1.9

3.3

4

4.5

2.5

2.5

2.5

Others

Multi-Location

32.5

34.13

35.83

Tata Steel Gopalpur

Orissa

2

2

4

JSW SALEM

Tamil Nadu

1

1

1

JSW ISPAT

Maharashtra

3.3

3.3

3.3

3.3

JSPL Pattratu

Chhattisgarh

1.5

2

3

3.5

POSCO INDIA

Orissa

4

Bhushan Power & Steel, Sambalpur

Orissa

1.2

1.8

2.5

2.5

Uttam Galva

Maharashtra

0.8

1.1

Monnet Isapat, Raigarh

Chhattisgarh

0.3

0.6

0.9

1.5

1.5

1.5

1.5

Visa Steel, Kalinganagar

Orissa

0.5

0.5

0.9

1.5

1.5

1.5

1.5

Others- Medium Scale (Jai Balaji, Kalyani, Mukand, MSPL, Brhamini etc)

Multi-Location

1.5

2

2.5

2.5

4

4

4.5

Total (Firm Projcets)

78.06

89.00

103.80

117.56

126.19

135.52

140.00

Additional Capacity not firm but possible

0.00

0.00

1.71

2.90

6.40

10.10

17.60

Realisable Capacity considering Possible Slippages

78.06

89.00

104.66

119.01

129.39

140.57

149.00

Note: Expansions shown in shaded region are not firm and therefore Realisable capacity has been calculated as - Realisable Capacity=Capacity from Firm Projects + Additional Capacity from Not firm Projects*0.5 Source: Steel Working Group report

8 Steel Insights, September 2012


Cover Story their way to China. Indian steelmakers primarily use lumps instead of fines as they are still in the process of increasing their beneficiation and pellet making capacity. However, a deeper understanding of the problem needs to be undertaken as this prime steel making raw material, though abundantly present in parts of India, would not be optimally utilised until a proper roadmap is charted out. Ore is surely India’s competitive edge for the domestic steel sector. But in a slowing competitive world market, having an edge is not enough and squandering an advantage can be suicidal.

Iron ore production, consumption and export Production

Domestic Consumption

(in million tons)

(in million tons)

Quantity (in million tons)

Year

Iron ore reserves

According

to

the

UN

Framework

2009-10

218.55

90.62

117.37

41794.85

208.00

111.40

97.66

41295.86

2011-12 (provisional)

169.66

116.30

61.80

Not Available

Source: For finished steel - Joint Plant Committee; Ministry of Steel, For production and consumption of iron ore – IBM, Ministry of Mines; For export of iron ore – MMTC, Department of Commerce)

Raw materials requirement for projected iron and steel production (base case)

(million tons)

2011-12

2012-13

2013-14

2014-15

2015-16

2016-17

73.70

85.90

94.50

104.00

114.50

125.90

6.13

6.88

7.66

8.54

9.38

10.00

115.03

135.70

149.43

166.66

185.24

206.18

Coking Coal

43.25

52.29

57.91

67.49

77.23

90.16

Non-Coking Coal (for Sponge Iron Sector)

35.31

37.86

36.50

34.71

33.92

28.41

PCI Coal

1.95

2.40

2.66

3.20

3.83

4.54

Manganese Ore

4.03

4.53

4.98

5.57

6.18

6.82

Chromite

2.64

2.90

3.19

3.52

3.93

4.31

Ferro Chrome

0.56

0.61

0.67

0.74

0.84

0.92

Ferro-Manganese

0.46

0.51

0.57

0.64

0.70

0.74

Silico manganese

1.26

1.42

1.56

1.74

1.94

2.16

Ferro Silicon

0.23

0.26

0.28

0.31

0.34

0.38

1.29

1.42

1.56

1.72

1.89

Crude Steel production Pig Iron for sale Iron Ore

Refractories Source: Steel Working Group report

Classification (UNFC), iron ore resources of the country, as on April 1, 2010, are 28.526 billion tons, of which 17.882 billion tons are haematite resources and 10.644 billion tons are magnetite resources. The states of Odisha and Karnataka, respectively, accounted for 36 percent and 20 percent of the total production of ore in India during the third year of the 11th plan.

A proper roadmap is needed for optimal utilisation of iron ore in which India has a decisive competitive edge. But in a slowing competitive world market, having an edge is not enough and squandering an advantage can be suicidal.

10 Steel Insights, September 2012

Value (in `crore)

2010-11

Steel capacity target

India is targeting crude steel capacity build up from 2011-12 to 2016-17 to an estimated level of around 149 mt. However, the realistic assessment on supply side has been made based on the factors of actual extent of land already acquired, availability of investible funds with respective companies to support the planned increase in existing capacity, availability of infrastructural network at the project sites and raw material linkages. Raw materials are crucial in determining the competitive growth of the steel industry. This is more so for an input-intensive extractive industry like steel. Requirement of major raw materials in the steel industry is determined not only by the rate of growth in output but also by the technology adopted for making the required steel. The choice of technology, in turn, is influenced by the relative costs of raw materials, energy, labour, capital and more specifically by the entire logistics of movement of raw materials and finished products. But at another level, for obtaining access to basic raw material linkages, especially of iron ore and coal, the industry also has to depend on potential intervention by the state and consensus building within the larger social space.

Export

Presently, most of the magnetite resources are not available for mining, as these are located in the ecologically sensitive Western Ghats region, where mining was banned on the orders of Supreme Court. Impact of the ban has been limited so far as the domestic steel industry is primarily based on hematite iron ore. Madhya Pradesh, Karnataka, Jharkhand, Odisha, Goa, Maharashtra, Andhra Pradesh, Kerala, Rajasthan and Tamil Nadu are the principal Indian producers of iron ore. The current estimates of iron ore resources presented above are likely to be further augmented for the following reasons: • I ntroduction of a new threshold of 45 percent Fe for haematite ores in place of the earlier norm of 55 percent Fe, which


Cover Story Resources and Reserves of iron ore in India*

mandates that lower grade ore should be used; • E mergence of Banded Iron Formations (BIF), hitherto considered as wastes, as important sources of iron ore with the adoption of suitable processing technology etailed exploration of the iron ore • D bearing areas. Iron ore consumption

production

and

India‘s iron ore production grew at a CAGR of 6.5 percent in the first three years of the Eleventh Plan and touched 219 mt in 200910 – up from a level of 188 mt in 2006-07. Production during 2010-11, however, is estimated to have fallen by 10.5 mt to 208.11

million tons

Grade

Reserves

Remaining Resources

Total Resources as on 1.4.2010

Haematite

8093.5

9788.6

17882.1

Magnetite

21.8

10622.3

10644.1

20410.9

28526.2

Total

8115.3

* As on 1.4.2010

mt. Domestic consumption of iron ore in India, on the other hand, increased from 78.6 mt in 2006-07 to 90.62 mt in 2009-10 and further to an estimated 111 mt in 201011. This translates into an average annual growth of 9 percent in the first four years of the Eleventh Plan. Exports accounted for around 50 percent

Source: Indian Bureau of Mines, Ministry of Mines

of the cumulative production of iron ore in India between 2006-07 and 2010-11. The export ratio peaked at 53.7 percent in 200910 and was the lowest at 46.9 percent in the following year i.e., 2010-11. According to the recent report by the working group on steel, with export restricting policies on iron ore and a potential fall in

Ore exploration takes a backseat? Even though the Indian steel industry has taken up ambitious growth plans, exploration of iron ore in India has taken a backseat in the last few years. According to industry sources, neither the government agencies nor the public sector mining companies are taking a proactive stance as far as new exploration is concerned. As a result, the incremental resource estimate of iron ore has shown only marginal rise over the last decade. As per various estimates, iron ore reserves in India stood at around 22 billion (bn) tons in 2000. The figure increased to 25 bn tons by 2005-06 and to 28.5 bn tons by 2011-12. If compared with incremental coal reserves estimates, this incremental reserve of ore may look trivial. Only over the last three years (2009-12), proven coal reserves in India has increased by around 14 bn tons. While the deposit formations differ in these two cases, the fact remains that government agencies have of late been giving priority to coal above everything else, a former director of Geological Survey of India (GSI) said. “This may be due to the government’s directives or economic compulsions or due to the pivotal role being played by coal in the economy. Whatever the reason, it is

12 Steel Insights, September 2012

surely coal which has become the centre of focus in mineral exploration in the country. Also, the recent row over illegal mining of ore in Karnataka may act as a dampener, going forward.” If not for this lack of aggressive exploration, the reserves estimates for ore should have shown larger increase in recent years following the adoption of new ore enrichment techniques. This is so because earlier enriched banded iron formation (BIF) containing 45-55 percent Fe was not considered as ore. But new development of ore enrichment techniques has made the use of lower grade ore possible.

According to GSI, “The quantum availability of such type of ore was never estimated in the past as these were considered as non-ore. The assessment of the new prospects and re-assessment of the existing mines is a must to optimise production, to cater to the demand of the market, based on economic grade and scheduling. Such exercise would obviously enhance the resource base to a great extent.” While new exploration is lacking, there was also a need to ensure proper data evaluation in leasehold areas, mining experts said. This is needed to examine the reserves and resource balances and assess if exploration was done optimally or in totality. The Indian Bureau of Mines (IBM) has an extensive role to play in evaluation of this data. Overall, mining exploration in India for all minerals is grossly under-explored. However, with consumption rising at a robust speed, exploration activities too needs to be taken up more aggressively, industry sources said. Along with that, efficient use of the ore must be ensured through beneficiation and pelletisation. This will help increase the life of current reserves, and conserve the same for future generations.


Cover Story demand for Indian origin iron ore in China, iron ore production capacity will have to be augmented with sufficient caution to avoid over supply as diversion of export volumes to the domestic market is expected to take care of a large share of the incremental domestic demand within the country. At the same time, it should be noted that iron ore capacity enhancement projects take a long time to complete. Although, capacity is likely to be enhanced over the Twelfth Plan period with the opening of new mines, actual supply to the market will depend on new capacities created in the non-captive segment, adequacy of infrastructure to handle movement of these ores, evolving situations related to legal restrictions on mining and movement of the ore and export potential. Iron ore prices are totally free from government restrictions and are determined by the market forces of demand and supply and individual consumer‘s tie-up for supply with the iron ore producers. Moreover, because of the existence of a large export market for Indian iron ore, domestic prices of iron ore have generally moved in tandem with the international prices. While the production cost of iron ore varies in the range of `500 per ton to `1000 per ton, depending upon the life of the

Iron ore remains the most crucial driving force for the steel industry in India and the industry‘s growth so far can largely be attributed to the domestic availability of low cost and high quality iron ore. mine, capacity of the mine and equipment employed, the price of iron ore, ex-mine, has remained much higher than costs in the past few years. This has been one of the main reasons for the Indian steel industry clamouring for allocation of captive iron ore mines, as captive iron ore is most likely to reduce their cost of production substantially. The cost of mining iron ore varies from mine to mine and depends on the mineralogy and other specific local factors. While mining costs on an average can be uniform, the costs of beneficiation may vary significantly from one mine to another. However, the main issues in delivered costs to the users are related not so much to the costs of mining, but to the transportation of the ore as also rates of taxes, royalty, etc payable on mined material. Iron ore mining and transportation costs have risen manifold in the recent period. Iron ore prices have, likewise, risen through the Eleventh Plan period. Price of iron ore has increased threefold

Production/ export/ import /domestic consumption of iron ore

(million tons)

Production

Export

Import

Domestic Consumption

2006-07

180.92

93.79

0.489

78.6

2007-08

213.25

104.27

0.293

85.28

2008-09

212.96

105.87

0.69

87.41

2009-10 (Prov.)

218.63

117.37

0.897

90.62

2010-11 (Est.)

208.11

97.66

-

111@

Year

Source: For Production & Consumption: IBM (Ministry of Mines); For Export: MMTC (Department of Commerce). Estimated by the Ministry of Steel

Production of iron ore (2006-07 to 2010-11) Year

(million tons)

Public

Private

Total

2006-07

62.759

124.937

187.696

2007-08

66.518

146.728

213.246

2008-09

64.746

148.214

212.960

2009-10 (P)

59.252

159.387

218.639

-

-

208.11

2010-11 (Est.)

(P): Provisional Note: Figures rounded off. Source: Indian Bureau of Mines

14 Steel Insights, September 2012

since 2005, after considering the increase in royalty etc. Apart from rising costs of mining and transportation along with hikes in taxes and levies, the recent rise in iron ore prices can be attributed mainly to: • I ncreases in domestic demand Calibrated Lump Ore (CLO); and

for

• A doption of the principle of global price parity for fines and other lumps by the major iron ore mining companies. Iron ore prices in the spot market vary significantly from those set by the mining PSUs such as NMDC and OMC who fix their prices on quarterly basis. The volatility in the spot market is driven by local market conditions, differences in grade and transport costs. The working group on steel recently suggested that underground iron ore mining technologies should be explored to maximise the potential of unlocking the resources of magnetite ores in the Western Ghat areas of Karnataka also at the same time maintaining environmental discipline. The government should set up a technology mission and form an expert group to monitor such research programmes. For planning and promoting the development of mine-related infrastructure, it will be necessary to put in place an appropriate institutional framework. In the major mining states, we already have Mineral Development Corporations and State Industrial Development and Investment Corporations. It would be necessary to enlarge the mandate of these corporations to include planning, promotion and financing of mining infrastructure. Exports of iron ore have risen sharply in the recent years. It has increased by about 3 times in seven years, from a level of 37.49 mt in 2000-01 to 117.37 mt in 2009-10 but fell recently owing to the mining ban at Karnataka. In view of the fact that iron ore is a non-renewable natural resource, its unbridled export from the country may have adverse implications for long term growth of


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D&B CERTIFIED CO.


Cover Story the domestic steel industry and of the Indian economy, in general, the working group on steel said. It is now generally accepted that iron ore resources of the country should be conserved for use by the domestic steel industry and ultimately for the benefit of the Indian people who have one of the lowest per capita consumption of steel within the fraternity of emerging economies, the report said. The report said long term policy measures for curbing iron ore exports should aim at attracting investment in steelmaking capacity so that value addition and export of finished products are promoted. In the short and more immediate time frame the same may be achieved by taking recourse to appropriate fiscal measures. At present export of iron ore from the country is discouraged through:

mines. Therefore, there is a need to give preference to value adders in With depleting high grade hematite iron allocation of mineral concessions by ore resources, however, exploitation of making necessary provisions in the MMDR Act in this regard. Besides, these magnetite resources may become there is a need to have time bound necessary to sustain the growth of the process for allocation of mineral concessions by the competent domestic steel industry in the long run. government authority at every stage. A time bound decision making in the process of allocation of mineral Allocation of iron ore mines is carried concessions will go a long way in out as per the provisions of the Mines & speedy development of the domestic mineral Minerals (Development & Regulations) sector. Act 1957 and the Mineral Concession Rules Beneficiation potential is low in the case 1960. Under the Act, mineral concessions of low grade haematite ores of the eastern are given in different stages of mining in region with Fe content in the range of 50 the form of Reconnaissance Permit (RP), percent due to high alumina content, which Prospecting License (PL) and Mining Lease not only raises the costs of beneficiation, but (ML). Under the law, a user can operate a • I mposition of an export duty of 30 mine under a valid mining lease for the also poses environmental hazards involving tailings. A significant research programme percent ad-valorem on iron ore; and period of lease. supported by the government is required in harging of significantly higher railway • C Many of the large steel investors are this area and one has to learn from the Indian freight on iron ore meant for export. setting up their projects on the premise that industry efforts so far. they will get full linkage of their iron ore Lastly, although, the present steel These measures have contributed to requirement through allocation of captive reduction in iron ore prices in the domestic mines. Allocation of captive iron ore mines capacities in the country are primarily based market as compared to the international justifies economies of scale, reduces the on hematite iron ore, over a longer period market and played a vital role in making production cost and compensates other of time, it may also be required to tap the available iron ore to domestic industries at inputs costs such as imported coal/ met coke magnetite iron ore resources located in the Western Ghats. Unlocking these iron ore competitive prices. To effectively discourage etc. resources may need recourse to underground export of iron ore from the country, it However, except for some of the major is recommended that appropriate fiscal steel companies like SAIL, Tata Steel mining technologies, so that the precarious measures should be designed and calibrated and JSPL, most of the other existing steel ecological balance in the Western Ghat on a continuous basis in line with the producers do not so far have any mining region is not disturbed while iron ore is exigencies of the ore market – both domestic leases for iron ore. Such a distortion has extracted. A detailed feasibility study needs to be undertaken to examine the technoand international. happened because iron ore prices were so economic viability of such technologies. While encouraging pelletisation of iron low, prior to 2000, that no steel company felt ore, the government will have to ensure that it necessary to own and develop captive iron Pellet making capacity there is no excessive export of pellets, which ore mines. India’s current pellet capacity is around 30-36 will defeat the very objective of reducing iron However, with sharp increase in the price ore exports by converting excess fines into a of iron ore, steel companies have realised the mt and it is likely to go up to 50 mt in another value added product for replacing iron ore need to have captive iron ore mines and hence one or two years. India is targeting pellet capacity of 80 mt by 2015-16. This includes lumps in domestic consumption. have been striving for getting captive iron ore capacities of Essar (12 mt), Tata (4 mt), BRPL (4 mt), Shyam Siel (1-1.5 mt), Bhushan (2 Estimation of demand for iron ore during 12th FY plan period mt), Abhijit Group, JSW (5-9 mt) and MSP (million tons) (1.2 mt), according to industry experts. 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 India is targeting pellet capacity of 80 mt by 2015-16, according to experts and this Crude Steel Production 73.7 85.9 94.5 104.0 114.5 125.9 includes capacities of Essar, Tata, BRPL, Pig Iron Production 6.1 6.9 7.7 8.5 9.4 10.0 Shyam Siel, Bhushan, Abhijit Group, JSW and MSP. Total Iron Ore Requirement 115.0 135.7 149.4 166.7 185.2 206.2 However, industry experts said most Source: Estimated on the basis of projections of crude steel and pig iron production during 12th Plan. of the pellet plants are coming without Note: The estimates are based on the assumed technology mix in steel production, standard inputbeneficiation capacity. Only Essar has 12 output norms and transit and handling losses of raw materials in the process.

16 Steel Insights, September 2012


Cover Story mtpa beneficiation plant in Dabuna –within close proximity of major mining sites. This will help the project to use low grade iron ore fines that are unused and not easily consumable and keep the environmental impact to a minimum with the use of slurry pipeline. SAIL, Tata and OMC mines have also planned their mines operation with cut off at 56 percent Fe content. According to rough estimates, around 200 million tons of low grade iron ore are lying in dumps and cannot be utilised because of lack of beneficiation technologies. Therefore, experts feel along with pellet capacity the country needs beneficiation capacity to properly use iron ore. Royalty structure

A royalty of 10 percent ad valorem is levied on iron ore. The mines ministry had sought a review of the 30 percent export duty on iron ore and a study group was constituted in the ministry for reviewing the royalty state structure. Meanwhile, according to reports, over a third of operating mines in Goa are set to be closed due to a recent decision by the state government to levy a 15 percent upfront stamp duty on the royalty paid by them. The draft mining bill, ready for submission in the state Assembly, said that mining leases for 337 registered mines expired on November 21, 2007. Prior to the date of expiry, the lessees submitted their applications for renewal or extension of the mining leases for a further 20 years. However, due to various factors, the government was not in a position to execute lease deeds for the purpose of renewal or extension till the state government passes an

18 Steel Insights, September 2012

While encouraging pelletisation of iron ore, the government will have to ensure that there is no excessive export of pellets, which will defeat the very objective of reducing iron ore exports by converting excess fines into a value added product for replacing iron ore lumps in domestic consumption. Pellet plants in India Major Pellet Plants in India

Capacity (MMTPA)

Essar Steel*

14.0

JSW, Toranagallu

9.2

JSPL, Odisha

4.5

KIOCL, Mangalore

3.5

Mandovi Pellets, Goa

2.5

Bharat Mines, Karnataka

1.2

Tata Steel (under commissioning)

6.00

BRPL(Stemcor – Under commissioning)

4.00

Bhushan steel & Power(u/constn)

4.00

Source: Steel Insights Research

order. As a consequence, the government was deprived of a very large amount of revenue by way of stamp duty which otherwise would have been payable by the lessees on the renewal of mining leases. It further said that the government proposes to levy on every instrument of grant or renewal of a mining lease the stamp duty equivalent to 15 percent of the amount of royalty that would accrue out of the annual extraction of minerals permitted under the environmental clearance. According to an estimate, the state government is likely to fetch total revenue of around Rs 2,500 crore through the proposed stamp duty levy. According to analysts, The India Stamp (Goa Amendment) Act 2012 proposes to impose a stamp duty of 15 percent of the royalty to be accrued over the leases period and to be paid upfront within 60 days of the Act coming into force. This signified significant cost to miners and will increase the total cost of production. Sources say although the current mining cost and price scenario (for iron ore) offers miners enough head room to absorb this extra cost, this may still result in higher prices for iron ore from the region.

There are only 97 mines currently in operation out of 337 registered with the state government. Hence, around 70 percent of registered mines are closed due to restrictions imposed by the state government following investigations by the MB Shah Commission inquiring into the legality of mines with required necessary permissions. Outlook

Iron ore exports in 2011-12 were around 61.8 mt. Several iron ore miners approached by Steel Insights said this year exports are likely to be in the region of around 40-45 mt in 2012-13. This drop in exports has happened due to a number of factors. For instance, in Odisha evacuation is only being done through rail route. There is also differential rate in railway transportation in case of exports. The rate comes to around `2,800 per ton for exports as against domestic transportation of around `700 per ton. This is hampering exports. The high export duty of 30 percent in case of both fines and lumps is also a dampener for exports, industry sources said. “The iron ore market is also undergoing dampened sentiment because of low realisation in the July-August period. However, the sentiment would improve in September-October owing to general historical rebound seen in steel consumption during the period,” said an iron ore miner based in eastern India. The sources agreed that around 44-46 mines had been identified in the “A” category with minimal irregularities. But the supply would not be more than 5 mtpa in the current financial year. Recently in April 2012, the Supreme Court switched to partial ban. Among others, it allowed miner NMDC to produce 1 mt per month. The court has capped iron ore output from Bellary mines to 25 mt annually and another 5 mt from Chitradurga and Tumkur districts. The CEC has said the mining


Cover Story

Timeline for major events in iron ore 2010

July: Karnataka state, governed by the federal opposition Bharatiya Janata Party (BJP), bans shipments of iron ore. The state government had faced pressure from the ruling Congress-led federal government to clamp down on illegal mining. Exporters in the state subsequently challenged the ban. September: Iron ore exports post their sharpest monthly fall in nearly two years after Karnataka’s ban and on slow Chinese demand. Exports drop 47 percent from a year earlier to 3.03 mt. November: Karnataka’s high court upholds the ban on shipments. State governments can decide on shipments or movements of resources but only the federal government can agree a ban on exports. November: Iron ore miners in the state say they will challenge the ban in the Supreme Court. 2011

January: Top iron ore producing state Odisha says it is considering seeking permission from New Delhi for a ban on exports. January: The Supreme Court delays its decision on the Karnataka ban to midFebruary. January: India’s state-owned railways announce an increase in freight costs on iron ore for export of 50 percent to `1,500 ($26.97) per ton. January: India’s Multi Commodity Exchange (MCX) and Indian Commodity applications should not be given permission unless miners implement a rehabilitation and redevelopment plan. The CEC auctioned about 22 mt of iron ore produced by NMDC and illegal ores lying in the stockyards in the fiscal year ended in March 2012 and will continue to hold auctions till April 2014. About 3 mt remained in stockyards. Karnataka collected `730 crore in 2011-

20 Steel Insights, September 2012

Exchange (ICEX) launch the world’s first iron ore futures contracts. But a ban on foreign players means liquidity is low. February: Steel Authority of India (SAIL) wins environmental approval for its own iron ore mines in Jharkhand, northern India. SAIL says they will be operating in three years and that they will be key to its future iron ore supply. February: The Supreme Court again adjourns its hearing on the Karnataka ban, this time to April 4. February: The central state of Chhattisgarh joins Odisha in seeking federal government approval to ban iron ore exports. February: India hikes export duty on iron ore to 20 percent from 5 percent for fines and from 15 percent for lumps in its annual budget. March: Freight rates are hiked again, this time by `100 per ton to `1,600 per ton. March: Indian Railways says it will impose a “busy season” charge of 7 percent on iron ore freight rates from April 1 to June 30 and from October 1 to March 31. The charge will equate to about `150-200 per ton, one trader says. April: The Supreme Court orders Karnataka state to lift its ban on iron ore shipments from April 20. June: Iron ore exporter Mineral Enterprises Ltd says it will ask the Supreme Court to uphold the lifting of the Karnataka ban, which has been delayed by an inquiry into illegal mining. July:

An

independent-led

inquiry

12 by claiming a share of the sales proceeds from the auction, which will be used for infrastructure development of mining areas such as Bellary, Chitradurga and Tumkur. The government expects to collect `10,000 crore from auction proceeds in coming years as more mines come on stream and the amount of ore increases. Meanwhile, in Odisha currently iron ore fines stocks are around 40 mt. Therefore,

implicates B.S. Yediyurappa, a prominent Indian opposition politician and chief minister of Karnataka, in a $3.6 billion illegal iron ore mining scandal. July: The Supreme Court imposes an interim ban on mining in the district of Bellary, a key iron-ore rich region in Karnataka, on concerns over environment degradation. July: Yediyurappa resigns as Karnataka chief minister. August: The Supreme Court partially lifts the iron ore mining ban in Bellary district, allowing state-run NMDC to mine up to 1 mt a month from August 6. August: The top court extends the mining ban to Tumkur and Chitradurga, two districts in Karnataka. December: India’s top iron ore producing state, Odisha, stops issuing export permits for iron ore cargoes shipped via two small ports, Gangavaram and Kakinada. 2012

April: The top court partially allows the restart of Category A mines or mines of more than 50 hectares in Karnataka. May: Odisha mulls a 4 percent cut in its output to curb illegal mining. August: Goa also considers an 18 percent reduction in its output because of limited infrastructure to handle supplies. September: The apex court allows 18 mines to resume iron ore mining in Karnataka state after a suspension of over a year.

going by the current trends, exports of fines would continue to remain in the region of 50-70 mt as with the lumps production, fines with low Fe content would get generated. Industry experts say in India the ratio of lumps and fines generation stands around 30:70. Since there is insufficient beneficiation capacity the low quality fines will be useless for domestic consumption and will need to be exported. 


SPECIAL FOCUS

Refractories sector needs innovative cost-cutting

of 198 kg. These facts strengthen the fact that the potential for India to raise its steel, cement, aluminium, etc consumption is high, which will augur well for the domestic refractory industry, Chattopadhyay said. As per Goldman Sachs, India will need to spend more than $1 trillion on infrastructure from 2010 to 2019, with roads requiring $427 billion, power $288 billion and Railways $281 billion. Some key decisions have been taken in principle like the national manufacturing policy for the creation of big industrial hubs, new telecom and mining policies and a lot would depend on their implementation. Steel & refractories sectors

Steel Insights Bureau

T

he refractory industry in India is inextricably linked to the steel industry. While earlier the steel industry in India was on a rapid growth path owing to the steep growth in India’s GDP, it is currently passing through a difficult phase. As a result, the refractories industry in India is also facing problems that are compounded by the high cost of raw materials, increasing cost of power and even a lack of technical manpower. For the refractory industry to survive in such times, it is essential to take some concrete steps in terms of improving the bargaining power of the industry. Innovations in reducing costs is the need of the hour whereas developing the ability to withstand competition from competitive

22 Steel Insights, September 2012

materials is also necessary, said A.K. Chattopadhyay, managing director of TRL Krosaki Refractories Limited, one of the largest refractory makers of the country, while addressing a seminar on steel making recently. India’s growth story is currently passing through a rough patch. High inflation, leading to high interest rate, large fiscal deficit coupled with the Eurozone crisis makes the Indian economy look very gloomy. In the recent monetary policy declaration on July 31, 2012, maintaining the key monetary rates at the present level, RBI has reduced the GDP forecast of 2012-13 from the earlier figure of 7.3 percent to 6.5 percent. However, a silver lining is that the Indian economy, especially the Indian core sector, has plenty of opportunities to grow. The per capita steel consumption of the country is a mere 48-50 kg against the global average

The status of the steel industry, with which the destiny of the refractory industry is closely intertwined, shows that a number of greenfield and brownfield projects have already been announced. According to an estimation by a group of leading economists, the BF-BOF route which at present constitutes 47 percent of steelmaking in India, may go down to as low as 33 percent by 2015, the reasons for which may be attributed to lack of coking coal in India and depleting resource of iron ore lumps, forcing the steel makers to rely on fines. Many are in the process of setting up pellet plants while land acquisition is a major issue in the country. Integrated steel plants need large areas while IF-EAF plants need a relatively smaller area. Challenges

The refractory industry in India is currently faced with a number of challenges which include continuous rise in raw material prices as there has been abnormal increase in fuel cost (32 percent approx.) and electricity (100 percent approx.) charges during the past one year alone. Secondly, owing to oversupply position of the refractories industry, the input cost increases have not been compensated by net realization increase so far which is posing a strong challenge to the entire refractory industry as a whole. However, one of the worst problems being faced of late is acute shortage of quality manpower with satisfactory technical knowledge and experience. In addition to these, inherently the structure of the industry


SPECIAL FOCUS is such that it gets squeezed from a number of angles such as the Bargaining power of the customers, suppliers, disturbance from new entrants due to low entry barrier as anyone and everyone can enter the market, fear of existing products getting threatened by substitutes as well as intense competition from existing and new competitors. “Low returns on investment have meant low investments in R&D, training and infrastructure development. This has also restricted attracting best minds to the industry as the latter have flocked towards information technology, biotechnology, and others sectors where the career options are much brighter. This, in turn, has affected the servicing of the user industries that more and more are shifting towards ‘Total Refractories Management’ for supply, erection and maintenance of the refractory linings. Thus, it is for the interest of the steel makers to work out a win-win situation with the refractory industry for their own longterm strategic interest,” Chattopadhyay pointed out.

Proposed greenfield and brownfield steel plants in India Existing capacity

Brownfield expansion

Greenfield expansion

Total capacity by 2012-13 (mt)

Tata Steel

6.8

3.2

3

13

Essar Steel

4.6

3.9

6

14.5

JSW Steel

6.6

4.4

11

Ispat Industries

3.6

0.6

4.2

JSPL

2.4

4.8

Bhushan Power & Steel

1.2

1.6

2.8

Bhushan Steel

0.8

2.2

3

Others & Secondary

31

3.2

34.2

12.84

8.56

21.4

2.9

3.4

6.3

72.74

35.86

Investors Private sector

10.45

Public Sector SAIL RINL-VSP Total

12.25

120

Source: Insights Research

India’s steel production forecast

The future trend

In million tons (mt)

Based on the current scenario, a few of the future trends that are going to influence the Indian refractories industry have been predicted by industry experts. One of these is the demand for clean steel so that the steel plants would be looking for refractories that are going to be used to ensure cleanliness of steel. Secondly, a trend may emerge for greater use of unshaped refractories as well as a newer understanding of MgO-C is emerging as refractories material for Ladle and Converter metallurgy. Demand for clean steel is marked by Low sulphur pick-up, low oxygen pick-up, low hydrogen, carbon and nitrogen pickup. Moreover, there is no re-oxidation of refractories into steel whereas non-metallic inclusions is minimised. With the increased demands set on ladle metallurgy, gas purging pumps have become extremely important. The main requirements are fast, optimum, homogenization of the steel melt and removal of non-metallic impurities. Auto grade steel requires excellent air-tight system to eliminate air ingress.

24 Steel Insights, September 2012

3.25

2009-10

2010-11

2011-12

2015-16

2019-20

Base Case

65

69

72

125

140

Optimistic

N.A.

N.A.

75

130

170

Pessimistic

N.A.

N.A.

72

120

140

Source: Insights Research

Monolithic advancement

According to Chattopadhyay, this is marked by Calcium aluminate binders of controlled reactivity that have been developed which allow a stable placement, Super ground reactive aluminas which are available with mean diameter d50<1 micron and sp. surface area of 10-12 Mt.Square/gm and they change the viscosity of the mix allowing them to be (a) Rammed (b) Vibro cast (c) Pumped or (d) Gunned. This versatility of the mix allows any area to be lined with optimal thickness of material. It also includes use of very special Vibrators and Gunning equipment -High Intensity Mixers >10 KW and >20 rpm, High Intensity Electric Vibrator >1200 cps and High pressure gunning equipment >10 KW and 50 m3 min. at >7 bar. “Use of polymeric resin is coupled with metallic element as the metal element is

attached to the polymeric chain in the form of a complexation cation. After coking these cations are in a highly reactive state and are fully dispersed. Moreover, it is to be understood that impregnating agent lowers the elastic modules of MgO-C refractories,” he said. Plastic–Elastic behavior under load have been studied and an activated resin then changes the structure of graphite bonding just like a normal flaky graphite structure which is more stable. “A number of research and development activities are currently being carried out in India which include research on Porous plug for quick homogenisation of steel and possible separation of deoxidation. These are Random, Directional, Random and Directional Al2O3 – Cr2O3 –ZrO2, he added. “Research activities on RH degasser area is also going on in full swing,” he further added.


SPECIAL FOCUS Apart from the above, studies are being conducted to improve the bottom life and also sources and magnitude of stress generation in vessels. The future challenges

The raw material situation will continue to dominate as India lacks quality bauxite and magnesite reserves and is dependent on imports. The need of the hour is to make India self-sufficient in raw materials for which the various research institutes need to play a lead role. During his presentation, Chattopadhyay focused on some of the important areas such as India has huge bauxite reserves but having CaO, Fe2O3 and TiO2 as impurities. He suggested that the research should identify methods for eliminating the unwanted oxides either to form a solid solution or to form compound with high liquidous temperatures. Since, Indian magnesite needs beneficiation, bioleaching can be adopted to remove harmful silica and finally actively following 3R (Reduce, Reuse and Recycle) principle. He also suggested that since India has got huge quantity of beach sand, it should be converted to high purity synthetic aggregates.

26 Steel Insights, September 2012

Share of oxygen and electric steelmaking 2011 (%)

2015 (%)

BF-BOF

47

33

IF/EAF

53

67

Source: Insights Research

Role of TRL Krosaki

Speaking on the role of TRL Krosaki as an industry leader so far as refractories market is concerned, Chattopadhyay said that TRL Krosaki has chartered its strategy for growth and is facing the challenges with a number of plans. He said, “Krosaki Harima Corporation acquired 51 percent of erstwhile Tata Refractories Ltd and the association with Krosaki Harima Corporation (KHC) will have a very significant effect on our business. It will have a positive impact on our growth in many respects. First, KHC has an excellent track record of quality products. They are technically superior in a number of products lines in which we have insignificant market.” “These will supplement and supplant our product basket. These products are Magnesia carbon technology for EAF and converters and related gunning mass, Flow control

products, including multiple heat systems and black refractories, Big BF taphole clays and BF trough business, DBMC for RHD snorkel and lower vessel,” he added. There is presently a huge (approximately `2,000 crore) market for such products which are not being served by TRL. Now with this collaboration, TRL Krosaki will get the technology from KHC and target this market with cost effective products. This will help the company to substantially increase its present market share. Moreover, TRL Krosaki can now tap the world market and sell its niche products like Dolomite, High Alumina and Silica refractories in the global market including Japan. KHC has the strengths of products quality, application and TRL Krosaki has the advantages of lower cost manufacturing and a wide market reach. Hence, association of KHC and TRL, Krosaki will be of mutual benefit to both that might lead to a win-win situation. With adequate technical knowledge from KHC, two facilities are being set-up in Belpahar at a Capex expenditure of `100 crore. These are Tap hole clay plant with an annual plant capacity 18,000 tons, product from which will be used in the big blast furnaces in the country, including that of Tata Steel. Another is the FCP plant with an annual plant capacity of 44,000 tons, products from which will be manufactured with KHC’s plant and process knowledge and technology and will be supplied for highend application. According to Chattopadhyay, this association will clearly give two advantages. First, TRL Krosaki will get advanced technology for different high end products from KHC as well as TRL Krosaki will continue to get advantage of low-cost manufacturing from the Indian operations of the company. With these dual advantages the company will not only maintain its leadership position, but strengthen its position as a global refractories player and continue to play a significant role in shaping up the refractories market throughout the globe on a sustained basis. 


interview

iMax targets `100 million revenue in 2012-13 Steel Insights Bureau

i

Max Technologies is one of the pioneers in collaborative enterprise solutions focusing on the metals and mining industry, and specialising in industry-specific solutions for mining, melting all kind of furnaces, rolling, concast and pipes and tubes. The company’s product iQ-Metallika is an enterprise solution preconfigured for rolling mills, furnaces, sponge iron plants and integrated steel plants to enhance efficiency of resources of the organisation. Speaking exclusively to Steel Insights, the vice president of iMax, Sahiel Khurana, discussed the company’s growth plans going forward.

Excerpts: Can you provide a brief description of the work profile of Imax Technologies? iMax technologies is an IT company with strong focus on the steel industry. Our product iQ-Metallika has been designed and developed exclusively for the steel industry and helps them to control cost and optimise operations, resulting in better profits. You have 16 different product modules for different client segments. Which of these product modules are the most popular?

Sahiel Khurana, VP, iMax

28 Steel Insights, September 2012

On the commercial side, Sales Order Processing, Procurement Management, Stock Control and Financial

Management are the most popular modules. On the production front, Production Planning & Control, Quality Control, Plant & Machinery Maintenance and Contractor Management are the most appreciated ones. Who are the competitors of Imax Technologies? Our competitors are Axis, Stratix, Verticent and Esteelman. What is Imax’s market share vis-à-vis its competitors and what is the target in next two years? After formally launching our product two years ago, the current market share is around 10 percent, considering the target market of steel units having production of 10,000 tons per month. The target is to have minimum of 33 percent of the target market share in the next two years. Where is your R&D centre located in India? Do you have any plans to invest in new projects to increase market share? We currently have our R&D laboratory in Delhi and we are very keenly seeking opportunities to grow organically or inorganically in the domestic and international markets. We have very aggressive plans to setup a development centre in Chennai. Currently, which industry is the maximum revenue generator for Imax Technologies and what is the break-up of share of revenue from the different industry segments? Our revenues come only from the steel segment as of now. What is Imax’s revenue target in 2012-13? We plan to cross a revenue figure of `100 million in revenues. What is the size of your workforce in India and do you have any plans to step it up? Currently we have a team size of 71

members and we plan to have a similar number at our upcoming Chennai development centre. What are your growth plans for the next five years? We plan to add more products and services required by the steel industry such as more instrumentation and automation in furnaces as well as predictive maintenance. We also plan to get our product for power released to enable our steel customers to use a single platform to manage their steel and power business. What do you think are the bottlenecks being faced by the steel industry currently in India? The bottlenecks being faced by the steel industry are as follows: ♦♦ The high conversion cost; ♦♦ Lack of control system to monitor vital parameters; ♦♦ Poor quality of raw material which results in lower yield per ton; ♦♦ High wastage ratio; ♦♦ High downtime due to improper preventive maintenance; ♦♦ Lack of automation to monitor and control the above factors. 


interview Tamajit Pain

T

he name ‘Bevcon’ was coined after it was creatively combined with a few letters of ‘Bucket Elevator Conveyor’ in 1990. Formed with the intent of catering to the rising demand for bulk material handling solutions, Bevcon Wayors has come a long way by evolving as an industry leader that offers high-quality, technologically advanced bulk material handling systems. The company’s motto – ‘Engineering – Built to Last’ has been its success mantra since the last 20 years and even today Bevcon is fiercely committed to offer the best engineering services to its clients. The company proffers crushing, screening, conveying, dust extraction, pneumatics and special conveying equipment. Further, Bevcon Wayors turnkey solutions include custom design, manufacturing, installation and servicing of bulk material handling equipment. A majority of this equipment is manufactured at Bevcon Wayors facilities itself which provide customers greater flexibility for custom designs suitable as per their requirements. Overall, the company specialises in providing solutions for power, steel and manufacturing verticals. Besides its strong manufacturing strength, Bevcon has also collaborated with many top engineering companies located in America, Europe, Australia and Asia. In India, Bevcon has its presence all over with offices in Hyderabad, New Delhi, Kolkata, Chennai, Pune, Raipur and Bhubaneswar. Group companies Spareng Inc. established in 2003 and Bevcon Zentry formed in 2004 have further Y. Srinivas Reddy, MD, strengthened Bevcon Wayor

30 Steel Insights, September 2012

Material handling industry to grow at 20% for next 5 years Bevcon’s presence in the bulk material handling industry. Bevcon’s key strength has been its world-class research and development division that offers cutting edge solutions and designs of long-term value. In a freewheeling interview to Steel Insights, Bevcon’s managing director Y. Srinivas Reddy discussed the company’s future growth plans.

Excerpts: What are the bulk material handling solutions offered by Bevcon? Bevcon Wayors specialises in Engineering to Execution (E2E) solutions for various bulk material handling needs and has executed more than 2,200 projects in the last two decades covering almost all sectors of the material handling industry. We manufacture most of the critical equipment like vibro feeders, crushers,


interview screens, material handling components, bag filters, pneumatic conveying equipment and linear and circular stockers-reclaimers. What are the application areas of your bulk material handling solutions? Bevcon Wayors exists in the areas of thermal, biomass power, steel, raw material handling, sugar, fertilizer, agriculture and mining. We have three business verticals – projects, products and dust control equipment. With the support of our collaborators, we are in a position to provide fine screening applications, pneumatic conveying of various materials of critical applications as well as unique solutions for space constraint areas through steep angle conveyors as well as sandwich belt conveyors which are capable of conveying bulk material in 90 degree / vertical and also stockyard equipment like stackers and reclaimers. What is Bevcon’s USP in bulk material handling solutions manufacturing industry? The USP of the equipment manufactured under brand of Bevcon are: • Reliability and efficiency of operations; • The best in quality, manufactured under in house ISO certified manufacturing units; • Cost effective; • Best in service; • Innovative features; • Low maintenance/low down time; • Low wear costs; • Lowest product life cycle cost; • Technology transfer from collaborations; • Customised product development to meet client needs. How many plants do you have in India and do you have any plan to expand capacity in the near future? Bevcon Wayors has two manufacturing facilities in Hyderabad and all the critical components are manufactured in-house. Both facilities are certified with ISO 9001; 2008 by TUV SUD south Asia and also under implementation of 5S in the workshops. Best of Total quality systems and processes exist across the departments, which are monitored by quality assurance department continuously. In the next one year, a third unit will be operational. Plans are already underway to expand capacity.

32 Steel Insights, September 2012

Do you plan to launch any new product in the near future? Our specially formed TDG group develops 10 to 12 new equipment per year on an average, for various material handling needs. Please share your experience in dealing with turnkey projects? Execution of turnkey projects is a challenging proposition. An organisation must have the ability to handle business in a techno-commercial manner and should be self-sufficient with infrastructure, human talent and project management capabilities to execute turnkey projects successfully. Over the past two decades, Bevcon Wayors has had the opportunity to associate with prestigious infrastructure projects as follows: • Solid fuel handling system BORL (Bharath Oman Refinery Limited) through BHEL; • Tata Steel blast furnace for pet coke feeding, Steep Angle Conveyors of 100cum/hr capacity; • The first of a kind 500 tons per hour metal recovery plant for Jindal Steel through Harsco; • Execution of coal handling system for 260 MW Abhijeet Infrastructure in record time; • Execution of captive based 50 thermal plants across India in last two years; • Associated with prestigious project of Jindal at Angul at its coal gas based DRI plant in raw material handling system;

• Execution of coal handling system for IMFA for their track hopper system with radial stacker of 70,000 ton storage capacity. What are the impact and emerging trends in your industry following the economic slowdown? The impact on business competition is fierce due to lower opportunity but I feel it is momentary. The situation will become far better once there is clarity on various environmental and mining related government policies. What are the significant achievements of your company and goals that you aim to achieve? Bevcon Wayors as an organisation has achieved a number of milestones in material handling applications and is recognised as one of the most reliable manufacturers. It has a pan-India presence with sales and service offices located in Pune, Baroda, Kolkata, Bhubaneswar, Delhi, Jamshedpur and Chennai. As part of the company’s vision, we plan to achieve a turnover of `500 crore by 2015. We also plan to enter into long distance cross country material handling and stockyard equipment manufacturing. The other plans are manufacturing of pipe conveyors and introduction of Sandwich Conveyor technology to the Indian material handling industry. What is your outlook on the industry’s growth in India and globally? The material handling industry can be classified as catering to two different needs of material handling – unit handling and bulk load handling. The size of the Indian industry is estimated to be around `5000 crore and is likely to grow at 20 percent year-on-year over the next five years, in keeping with the overall economic growth. There are nearly 200 small to major players in the Indian material handling industry. I am very optimistic that a country like India which is rapidly growing, has abundant opportunities to develop the infrastructure and the material handling industry will play a very vital role in it. 


Corporate

A new chapter begins with JSW Ispat-JSW Steel merger Sanjukta Ganguly

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SW Ispat Limited, one the leading producers of hot rolled coils in India, has merged with JSW Steel Limited, another leading steelmaker of India from the O.P. Jindal group stable. This merger, which marks one of the most important chapters in the history of the Jindal group, came as a well thought out decision taken by the board of directors of both the companies, company sources informed. JSW Steel Limited and Ispat Industries Limited, now renamed JSW Ispat Steel Limited (JSW Ispat), in December 2010, took a historic step when JSW Steel invested `2,157 crore in JSW Ispat and became the largest shareholder in JSW Ispat. However, the two companies have cemented their alliance by announcing the merger of JSW Ispat with JSW Steel, which completes the integration of the two businesses and enables the full realisation of strategic benefits resulting from the combination, the company said in a statement. Integration

The exchange ratio recommended by the valuers and approved by both the Board of Directors of both the companies is one equity share of JSW Steel to be issued for every 72 equity shares of JSW Ispat. Commenting on the merger, chairman and managing director of JSW Steel, Sajjan Jindal, said “The merger of JSW Ispat with JSW Steel is an important step in our ongoing growth journey towards creating a world class global steel company. JSW Ispat brings several unique advantages and the merger will help in realisation of integration benefits of the two companies.” This integration process of JSW Ispat with JSW Steel is set to bring about significant strategic advantages with it, particularly alternative steel making technologies, ability to achieve swift capacity expansion, shore based facility and Pan India expansion of market reach.

34 Steel Insights, September 2012

According to company sources, the merger completes the integration and aims to capture full value of the combination primarily by achieving economies of scale. So far as enhanced market reach and location advantages are concerned, both the companies are aiming at leveraging each other’s marketing and distribution platforms to expand market reach. Moreover, reduction of marketing, general and administration overheads via better utilisation of infrastructure and elimination of redundancies is also being looked into. Financial benefits

Both the companies as a result of the merger are looking towards realising significant financial benefits via accelerated utilisation of unabsorbed tax losses at JSW Ispat as well as optimal use of depreciation on further capital investments. Moreover, it is an initiative to improve JSW Ispat’s cost structure via faster implementation of several plant integration initiatives as well as the newly merged entity can now explore its potential to reduce cost of financing, the company said in a statement. Under the terms of the proposed Scheme of merger, equity shareholders of JSW Ispat will receive one equity share in JSW Steel of face value of `10 each for every 72 equity shares in JSW Ispat held by them while JSW Steel’s shareholding in JSW Ispat will stand cancelled. JSW Steel will issue 1.86 crore new equity shares, thereby increasing its outstanding shares to `24.17 crore and its equity capital to `241.72 crore. JSW Steel will also issue 48.54 crore new 0.01 percent nonconvertible cumulative redeemable preference shares to the preference shareholders of JSW Ispat increasing its preference share capital to `764.44 crore. In fact, in the post-merger equity share capital, the promoters of JSW Steel will own 35.12 percent in the merged entity, 14.92 percent shall be held by JFE Steel

International Europe BV (herein referred to as “JFE Holdings”) and the remaining 49.96 percent will be held by the public shareholders. In addition to this, the downstream units of JSW Steel at Vasind and Tarapur and the downstream unit of JSW Ispat at Kalmeshwar will be transferred to a wholly owned subsidiary of JSW Steel as a part of the scheme whereas the appointed date of the scheme will be July 1, 2012. JSW Ispat’s turnaround journey

According to information available with Steel Insights, JSW Ispat has made significant progress in its turnaround journey since the acquisition by JSW Steel. A number of strategic and operational initiatives have already been completed while few others are in the process of implementation. These include JSW Steel’s assistance in better sourcing of key production inputs especially power supplies from JSW Energy leading to improved profitability. Secondly, marketing strategies have been reworked leading to freight synergies and better realisations. Thirdly, the complexity previously arising from the financial imbalance at JSW Ispat at the time of acquisition was removed through timely equity infusion, debt refinancing and rationalisation of working capital funding. JSW Ispat was, infact, brought out of CDR through enhanced ability to pay interest which has led the company to become EBITDA positive. JSW Steel continues to sustain the turnaround through cost reduction initiatives in the form of setting up of 1 million ton per annum (mtpa) coke oven and a 4 mtpa pellet plant which expected to be commissioned in FY14 to ensure dedicated supplies of these key inputs at competitive costs. Also commissioning of the power plant with a capacity of 55 MW, lime calcination plant and railway siding by June 2013 is expected to earn significant benefits for the merged entity as a whole. Riding on these successful initiatives, JSW Ispat is now stable and is poised to be further profitable on completion of the above mentioned projects. Having already embarked upon a path of success, only time will tell what new heights this newly merged entity attains. 


Corporate

JSPL gears up to reduce DRI production cost Sanjukta Ganguly

J

indal Steel & Power Ltd (JSPL), which boasts of having the world's largest coalbased sponge iron manufacturing facility and is one of the market leaders in coalbased sponge iron making within India, has pulled up its socks to reduce costs involved in production of sponge iron. The company, along with others involved in DRI making, has been facing tough challenges in recent times. In the current scenario where input costs are escalating exponentially, the company has explored all avenues of keeping cost

JSPL begins commercial production at Angul Jindal Steel & Power Ltd (JSPL), one of the leading steel producing companies of India has started commercial production of India’s widest 5-metre wide plate mill at its plant in Angul, Odisha from the last week of August, company sources informed Steel Insights. The plate mill is a part of the planned first phase 6.0 million tons per annum (mtpa) integrated steel plant at Angul, Odisha, the company said in a release. This plate mill has an annual capacity of 2 million tons per annum (mtpa). The company is targeting to produce 15,000 tons in the next month and then increase the production gradually. This 5-metre wide plate mill at Angul is a part of the company’s forward integration process of completing the process chain to produce value-added finished discrete plates. The technology and equipment is supplied by Siemens VAI UK & capable of rolling wide width range and steel grades like structural, boiler quality, shipbuilding and pipeline plates up to X-80 Grades. The plate mill is equipped with walking beam type of Reheating furnace technology supplied by Fives Stein France with level 2 automation, SVAI patent MULPIC cooling system, hot leveller & GE GMBH online Ultrasonic Testing facility for excellent plates surface quality and close dimensional tolerances and flatness control. In another development for the integrated steel plant, BSI (British Standards Institution) has certified 5.0 Meter Wide Plate Mill for Integrated Management System (ISO9001, ISO 14001 and OHSAS 18001) Certification. The plate mill is a part of integrated steel complex and being set up along with 1.6 mtpa Steel Melting Shop at a combined project cost of Rs. 4923 crores. SMS is likely to be commissioned towards the end of FY 2013. This project has been funded on 2:1 debt equity and debt of `3282 crore has been funded by consortium of Indian banks with largest loan given by SBI, PNB, Vijaya Bank and others. These plates find markets in the oil and gas, water pipeline, shipping, infrastructure and power equipment manufacturing sectors.

36 Steel Insights, September 2012

under check and has also found out multiple opportunities for cost reduction, senior general manager & head of DRI activities at JSPL, Raigarh, Vivek Agarwal, told Steel Insights. “At a time when the entire industry is reeling under pressure, improving the bottomline of the company by cost reduction has become increasingly important,” he said. According to Agarwal, JSPL has devised and started to implement a number of measures to reduce the company’s DRI production cost which have already started to reap benefits for the company. Cost reduction

As a primary measure for cost reduction, JSPL has resorted to use of pellets instead of iron ore fines for DRI production and this is being done through proper process optimization combined with improved quality standards. This along with use of better improved technology, in turn has helped in reduction of coal consumption by about 10% for the company. In addition to this, consumption of refractories has been brought down significantly from about 2 kg per ton to 1 kg per ton for DRI production which has also impacted the cost structure. JSPL, which is currently on the path of


Corporate ‘optimisation of resources’ has decided to use the best maintenance practices which has led to up to 99.5 percent availability. In order to align the production activities, the company is using laser technology currently which has slashed maintenance cost by 20-22 percent. Value engineering in maintenance practices implemented by JSPL’s employees have also resulted into outright decrease of outsourcing activities. Along with this, many other such activities which were earlier being outsourced by JSPL to other companies are now being executed by JSPL’s own employees.

Moreover, the inventory control techniques which are in vogue have played their roles significantly in reducing wastage of resources thereby keeping the cost figures under strict control and have helped to bring down the cost from about `11 crore to about `7 crore, Agarwal added. Minimisation of breakdown time has been possible by introduction of value engineering as well as accretion generation from DRI has been reduced simultaneously. “Along with curtailing cost, we have also initiated waste utilisation which includes

selling of char and castables from kiln which are being sold at `1,600 per ton. However, by use of right technology, dust generation has been reduced” Agarwal said. According to company sources, cost of coal and iron ore being exclusive, by application of all these measures, the company has been successful in saving `500 per ton (approx.) leading to a total saving of about `66 crore annually. However, keeping cost under control, how much the company can pull up their revenue figures during the current fiscal is to be watched. 

Uttam Galva Group to buy out Lloyds Steel Steel Insights Bureau

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ttam Galva Metallics, a leading pig iron producer and part of the Uttam Galva Group, has decided to acquire a controlling stake in Mumbaibased Lloyds Steel, media reports said recently. The move is expected to help Uttam Galva to enter primary steel making, Ankit Miglani, managing director of Uttam Galva was stated as saying in the report. Lakshmi Mittal promoted ArcelorMittal holds a significant stake in Uttam Galva. In fact, Uttam Galva Metallics currently holds a 24.53 percent stake in Lloyds through two of its subsidiaries — Ultimate Logistics Solutions and Metallurgical Engineering and Equipments. Uttam Galva had acquired the stake in Lloyds steel as a strategic investment, but on further evaluation found that it can significantly add value to the company if it has the management control. He said the company, through the two subsidiaries, will first increase its stake to 52 percent and then come up with an open offer to acquire a further 25 percent stake in Lloyds Steel. “We had earlier acquired over 24 percent stake in March as a strategic

38 Steel Insights, September 2012

investment, but upon further evaluation, we realised we can significantly add value to the company if we have management control,” Miglani said. The company, through its two subsidiaries, will first increase its stake to 52 percent and then come up with an open offer to acquire a further 25 percent stake in Lloyds Steel, according to market sources. According to sources, Lloyds Steel, which buys Uttam Galva’s products, has been struggling to pay off debt and raise working capital for running its plants for quite some time. Therefore, Uttam Galva currently has the plans to pump in cash, deploy other resources, upgrade the current infrastructure and turn Lloyds Steel into an integrated steel plant. “We are looking at turning around the company and making it sufficiently profitable in the next two years,” he said. Sources said the terms of the deal are already finalised and while Ultimate Logistics Solutions is likely to pick up over 39 crore shares, Metallurgical Engineering will pick up just over 15 crore shares to take the overall holding in Lloyds to 52 percent. However, the option of delisting the company is being evaluated once the entire transaction is over.

Ankit Miglani, MD, Uttam Galva

“Currently we are focused on concluding the equity transactions, but going ahead we will need to invest a lot to upgrade Lloyd’s facilities, since they are not been very well-maintained at present,” he added. Lloyds Steel currently has a steel manufacturing capacity of 1 million ton per annum (mtpa), including 0.7 mtpa hot rolled coils and 0.3 mtpa cold rolled coils. But capacity utilisation has been poor. Although capacity utilisation at Lloyds Steel is poor, the company currently has steel manufacturing capacity of 1 million tons per annum (mtpa), including 0.7 mtpa hot rolled coils and 0.3 mtpa cold rolled coils. Uttam Galva has a long-term relationship with Lloyds Steel through Uttam Galva Metallics, which owns a blast furnace at Wardha. Lloyds Steel has its 1 mtpa steel plant nearby and sources its pig iron requirement from Uttam Galva Metallics. The blast furnace produces close to half-a-million-ton pig iron, 80 percent of which is supplied to the Lloyds plant. 


Corporate

RINL signs MoU with PowerGrid for electrical steel

feed the right quality of hot rolled coil for producing CRGO steel. Recently, RINL had floated a global expression of interest (EoI) for potential technology suppliers and had detailed technical deliberations with them along with Power Grid officials and others. Earlier, RINL and PowerGrid signed a MoU in December 2011 to set up a joint venture for the manufacturing of transmission line towers and tower components including high-end R&D products. The MoU for the electrical steel project was signed by chairman & managing director (CMD) of RINL, A.P. Choudhary and CMD of Power Grid Corporation, R.N. Nayak, in presence of directors of RINL, Umesh Chandra (operations), P. Madhusudan (finance), T.K. Chand (commercial) and director (personnel), director (projects) of Power Grid Corporation on July 30. Other expansion projects

R.N. Nayak, CMD, Power Grid Corporation and A.P. Choudhary, CMD, RINL siging the MoU

Steel Insights Bureau

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ashtriya Ispat Nigam Ltd (RINL), a leading Central public sector undertaking and the first shore based integrated steel plant in the country under the Ministry of Steel, has signed a memorandum of understanding (MoU) with Power Grid Corporation of India (PGCIL) for setting up a joint venture electrical steel production unit at Visakhapatnam. Vizag Steel is a market leader in long products with a market share of about 10 percent. It has been supplying various grades of steel for construction of projects of National importance which include metros, power sector, bridges, nuclear complexes and several others. RINL-VSP has exported finished products to countries like USA, UAE, Thailand, Bangladesh, Nepal, Sri Lanka etc.

40 Steel Insights, September 2012

RINL, which chalked out an expansion plan while finalising the vertical growth plan from 7.3 to 11.5-12 million tons per annum (mtpa), had taken a parallel action to go for production units for value added products like silicon steel (electrical steel). Hence, signing the MoU with Power Grid Corporation of India is the first step in materialising the plan, company sources said. According to information available with Steel Insights, silicon steel is not currently available in India. Efforts are being made to establish such facility in India which till now is meeting its entire requirement of electrical steel through import. As per the MoU, the joint venture company will take up a project for production of cold-rolled green-oriented (CRGO) and cold-rolled non-oriented (CRNO) steel. It will set up a new hot strip mill suitable to

Visakhapatnam Steel Plant (VSP) has already expanded its capacity to 6.3 million tons per annum (mtpa) of liquid steel. The new blast furnace has been commissioned on April 24, 2012 and is under stabilization. While the new Caster has been commissioned, the trial runs of LD Converter are also over. RINL is in process of commissioning of balance facilities which includes Wire Rod Mill, Special Bar Mill and Structural Mill which is likely progressively during this current fiscal with a total investment of `12,291 crore on the expansion projects. On the other hand, RINL has also undertaken modernisation and upgradation of its blast furnaces which will increase the hot metal production capacity by 1 mtpa. Additionally, one converter, caster and seamless tube mill are also being installed along with revamping of the existing sinter plant and BOF Shop to match with the hot metal production and the capacity shall increase to 7.3 mtpa liquid steel. The units are likely to be commissioned progressively by the year 2014. However, as per company sources, next phase of expansion to around 11.5 mtpa of liquid steel involving an outlay of over `22,000 crore has already been conceived.â&#x20AC;&#x201A;


Corporate

Essar Steel secures pipe orders from Middle East, Africa Steel Insights Bureau

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ssar Steel, a fully integrated flat carbon steel manufacturer, announced that it has received two sizeable orders from the Middle East and Africa for manufacturing of API (American Petroleum Institute) grade steel pipes worth `400 crore, according to information available with Steel Insights. This takes the total order book of the pipe mill to approximately `1000 crore indicating strong order inflow for the company. The first order in Africa is for the construction of 4000 tons offshore line pipe application which will be used in a Chevron project. Customer from Middle East placed

its second order with company for 45,000 tons of 48 inch high grade coated pipes that are to be supplied in the coming quarter. This will facilitate the company in strengthening its position in the niche market segment worldwide. “This is reflection of Essar Steel’s integrated capability to produce world class pipes. To cater to the wide range of pipe products manufactured through various routes, our Pipe mill has full-fledged facilities for inspection and testing to ensure production of high quality pipes including sour service. Our aim is to become a preferred supplier of quality steel to all our customers, domestically and globally,” Dilip Oommen, MD & CEO, Essar Steel India, said.

Essar Steel’s pipe mill has the capability to manufacture 6,00,000 tons comprising 2,75,000 tons per annum of API-grade HSAW (Helical Submerged Arc Welding) Line pipes, ranging from diameters 16” to 110”, thicknesses 6.4mm to 25.4mm in Grades through and up to X-80 and 3,25,000mt per annum of API-grade LSAW (Longitudinal Submerged Arc Welding) Line pipes, ranging from diameters 16” to 60”, thicknesses 6.4mm to 65mm in Grades through and up to X-80. The facility is an amalgamation of bestin-class technologies including tube mill, Welding technology, Inspection technology and is fully automated with the least manpower requirement with respect to the prevailing industry norms. API grades of steel pipes require a fine grain structure for maximum impact resistance – an important performance feature for line pipe applications, preventing any crack in the steel from propagating down the line. 

Konecranes develops wire rod testing device RailQ Instrument

Steel Insights Bureau

K

onecranes, one of the leading companies in the lifting industry, has developed RopeQ, a reliable and practical system that evaluates the working condition of wire ropes using advanced, Non-Destructive Testing (NDT) methods, the company said in a statement. RopeQ is a diagnostic tool that uses electromagnetic technology to assess the inner and outer wires and strands of a wire rope. This testing method achieves reliable, accurate, and repetitive inspection results that ensure safe use and improve total lifecycle cost. After an exhaustive research of 60 years in the design and maintenance of hoisting equipment, Konecranes has developed this unique technology called RopeQ,

42 Steel Insights, September 2012

Konecranes engineer inspecting with RopeQ device

the statement added. RopeQ applies an electromagnetic-inductive testing method to detect flaws that are not visible on the surface of wire ropes, producing an accurate assessment that can increase safety and reduce wire rope cost. The RopeQ diagnostic tool fastens to wire rope assemblies and records a series of interior images along the entire length of the wire rope. The diagnostic survey produces data that pinpoints all areas and degrees of degradation. RopeQ is appropriate for a wide range of applications including steel mills, paper mills, steel service centres, foundries, wasteto-energy plants, pulp mills, chemical plants, power stations, nuclear power plants, aerospace and general manufacturing, the statement further added. 


technology

Danieli develops mini PLTCM to produce CR strips Sanat K. Bhaumik

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ith the present market trend aiming continuously for production of thinner and thinner cold rolled strips, the equipment for cold rolling operation for these thin strips require to adopt necessary changes to remain competitive in the market. Arvedi group, one of the most significant European steel producers, awarded a contract to Danieli & C. SpA for supplying a PLTCM to process thin hot rolled coils from their endless strip plant. This contract allowed Danieli to implement a revolutionary mini-PLTCM solution for this mill to produce cold rolled strips mainly for automotive applications and high strength steel grades. Annual production capacity of this mini-PLTCM will include 1.30 million tons per annum (mtpa) of cold rolled strips plus 0.30 mtpa of side trimmed HRPO coils with provision of producing HRPO skin passed coils (in future).

DASIX Series 6hi technology

44 Steel Insights, September 2012

Introduction

Over the years, Danieli has acquired the experience needed to design and manufacture plants to produce quality automotive steel grades. For automotive grades, producing steel strips with the highest material properties and surface aspects is not enough; control is the key aspect of Danieli’s equipment. This is demonstrated by the revolutionary Continuous Pickling coupled with the Tandem Mill for thin strip production at Acciaierie Arvedi. This mini PLTCM uses the input hot rolled coils produced at Arvedi’s ESP (Endless Strip Plant) mainly to produce high end cold rolled strips at a very competitive cost. To ensure best final product quality and production flexibility, the following series of process equipment have been selected specifically to produce thin gauge material: a laser welder, highspeed loopers, high tension scale breaker, 28-metre long pickling tanks, carousel type side trimmer, helical turning device for 900

turning of strips before the cold mill, threestand 6hi mill with innovative bending and shifting blocks, 2,600-ton HAGC, strip cooling system, new strip drying system, flying shear and carousel type tension reel. This revolutionary mini PLTCM mainly consist of the following equipment: • Double pass entry section with laser welder and horizontal strip accumulator • Wet type tension levelling scale breaker • Turboflow® Pickling section • Multi-stage cascade rinsing section • Hot air drying system • Side trimmer with scrap chopper and intermediate looper • Visual inspection, electrostatic oiler and HRPO coiler • 900 strip turning device for entry to tandem mill • Three stand 6hi tandem mill • Carousel coiler Scale breaker

The scale breaker is of proven Danieli Wean United design in operation at many plants worldwide, such as Dofasco, Arcelor Sollac, Corus or Arcelor Bremen. It has two levelling cassettes and one anti-crossbow cassette. Under normal conditions, one levelling cassette will be operating and the second will function as an installed spare. For extreme, high yield conditions like TRIP


technology 780 or Dual Phase, or thin gauge material, both cassettes are in operation. This machine ensures uniform scale breaking and improved strip shape for all material including high strength up to 1200 MPa; both these aspects are necessary to have a stable, high process speed even if wavy incoming product should be processed. The removal and loosening of the scales on input hot rolled strips reduce the load on hydraulic pickling section while the improved trip shape results in higher yield at the trimmer. In the innovative DANIELI Turboflo® pickle line, turbulence areas exist in every cell inside of one tank on the top as well as on the bottom strip surface. Special provisions in cell design allow acid internal circulation in tank cover segments, thus reduced sealing energy at the pickle tank exit is required. As a result, a thin laminar boundary layer is formed, which allows a fast pickling process. The High-Speed Turboflo® system is especially effective for thin strip travelling at high speed as each tank is divided into several turbulent cells that take advantage of the strip speed to induce turbulence and to ensure uniform pickling action from the entry to the exit of the tank. The advantages of the Turboflo® are: • Processing light gauge (up to 0.7 mm thick strips) at speeds up to 400mpm without worrying about maintaining emersion. • The shortest possible pickling system. • The possibility of quick draining due to the limited tank volume. • A catenary is no longer needed and therefore strip tracking is more accurate. • High thermal efficiency keeping hot fresh liquor in contact with the strip at all times. • The unique cover design eliminates the surge of fluid at the exit ends of the tanks, also generating turbulence. • The high turbulence does not place the wringer rolls under any high fluid pressure, thereby simplifying the sealing design and maintenance.

The scale breaker under assembly at Danieli workshop

The pickling action is controlled by automation, as well as a suitable preliminary preparation of the strips to be processed and the kinetics of the pickling liquor supplied at each pickling tank inlet and outlet. At the same time, the temperature of the pickling liquor can be lowered and/or raised. The new side trimmer and scrap chopper unit trims and chops both edges of the strip, and the whole system is mounted on rotating platforms. Safety is the key issue of the innovations applied to this machine. The two rotating bases are provided to change the side trimmer and scrap chopper heads quickly. Each base is rotated 180° by a rotary actuator and the travel wheels are driven by a hydraulic motor. The position of the knives is automatically regulated and follows the strip width by means of hydraulic cylinders and position transducers. The two platforms are designed to guarantee the operator the ease and safety of changing the side trimmer and the scrap chopper knives.

When the bases have been rotated they are locked into place by hydraulically operated wedges. The side trimmer housing is designed to prevent any dangerous operations from being carried out on the machine; this function is controlled by the operator from the control pulpit. The common strategy of Danieli and Arvedi in implementing a cold complex is to have fastest return on investment. The lowest investment costs and the lowest transformation costs are the key parameters for achieving this target. Due to space limitations a strip turning device was needed to couple the CPL to the TCM. The helical turning device was selected over the turning tower as there is no need for a large pit or a high building. Minimising civil works, land usage and coil handling equipment made a helical type turning device the only solution to couple the pickling line and the cold tandem mill which are in different bays at 90° to each other. The target of processing thin gauge material forced Danieli to evaluate the entry tandem mill machine layout. At the entry of the six-high three-stand tandem cold mill, there is a coarse steering system to center the incoming strip, removing all the errors accumulated in the exit looper with +5 mm accuracy. Then, a four-roll bridle is used to control the entry mill tension, filtering all the incoming tension noise from the exit looper with ±2 % in steady state, ±4 % in transient of preset value. Finally, a fine steering unit centers the incoming strip just before the roll gap of stand 1 with an accuracy of ± 1 mm. Also, before stand 1 there is a threeroll stabilizer to stabilize the strip, increasing rolling stability and stand insensitivity to strip incoming profile, friction and work roll shifting for edge drop control. The innovative three-stand tandem cold mill has x-ray thickness gauges and laser speed meters plus encoders for redundancy at entry and exit of stand 1 for mass flow control. The exit thickness gauge on stand 1 also is used, together with inter-stand

Schematic layout for the Continuous Pickling section

Continuous Pickling Section

46 Steel Insights, September 2012


technology encoders, to monitor and adjust rolling force on subsequent stands. To ensure an accurate material exit thickness, a double thickness gauge that works in closed-loop feedback with stand 3 and stand 2 has been installed at exit of stand 3. Product control

This 3-stand 6hi tandem cold mill targets thin and ultra thin materials in high-strength and dual-phase, TRIP and martensitic steel grades, where flatness performance requires new, accurate and sophisticated models. Together with the mechanical equipment, such as bending blocks, shifting blocks, as well as roll coolant, flatness performance is achieved by using models such as flatness predictor, least mean square algorithm, advanced actuator de-coupling, force feed forward, coolant offset analysis and coolant recovery models; all linked to the shape meter at the exit of the last stand for automatic flatness correction, including OSRT on intermediate rolls and tapered work rolls of edge drop control. Among all features, the DASIX series mill stand includes â&#x20AC;&#x153;window typeâ&#x20AC;? internal equipment ensuring easy maintenance.

Carousel type operator friendly side trimmer

When processing different strip widths and thicknesses, a large flatness correction capability is required and achieved by the work roll and intermediate roll bending and work and intermediate roll shifting. The work and intermediate roll bending system consists of a set of hydraulic cylinders

that exert bending forces on the work roll chocks and roll necks. The work and intermediate roll bending system is a twoway type, and bending is performed by the same hydraulic cylinder to achieve ultra-low and stable bending forces, too. In the positive bending mode (crown-

Steel Insights, September 2012

47


technology in), forces are exerted on the work roll chocks in the direction needed to separate them. The work rolls are bent against the backup rolls. In negative bending mode (crown-out), the forces are exerted in the opposite direction. The bending cylinders are located in â&#x20AC;&#x153;C-blocksâ&#x20AC;? mounted on the inside of the housing posts. A specially designed hydraulic control for the bending cylinder prevents instability at the transition between positive and negative bending. Long-stroke shifting is performed for both intermediate and work rolls. For intermediate rolls using an OSRT grinding profile, it enhances the shape control field, while shifting of the tapered work roll is used for edge drop compensation, which is needed for tailor-blank laser welded components for automotive production. Ultra low hysterisis HAGC

To guarantee high performance and to comply with the toughest present and future final product market requirements, better performance has been obtained from hydraulic AGC to improve thickness accuracy and tolerance. The starting point to achieve better results is to improve the frequency, position and pressure response of the HAGC. The standard system includes hydraulic pressure and flow rate control via servo valve on the bore side and a constant pressure control on the rod side. Danieli Wean United carried out thorough research and development in this field, coming up with a new HAGC design with ultra-low hysteresis thanks to reduced friction, new hydraulic control with two servo valves, one for the bore side and the other for the rod side, and new HAGC control software. These innovations made it possible to achieve new response times, i.e. 22 ms for an increase of

50 micron meter and 10 ms for an increase of 10 micron. Flexible rolling conditions

A new flexible system developed by Danieli associates applies direct lubrication to the traditional recalculating system, with benefits in terms of strip surface quality, material yield and mill operation. A standard technology applied to tandem mill lubrication to produce sheet is the recirculating roll coolant system. A stable emulsion system is used to lubricate the bite; at least two separate systems are provided, one for the first four stands and the second for the last one. The limitation of this system is its lack of flexibility when changing steel grade. During work roll change the first rolled coils show very poor surface quality and the friction coefficient decreases with the increase in mill speed due to the hydrodynamic effect on the roll bite. To mitigate these disturbances, Danieli has developed a mixed lubrication system in which traditional recirculation is enhanced with a direct application capability. This solution makes it possible to change the lubrication effect dramatically, if and when required, keep the friction coefficient as stable as possible in all mill conditions, and improve strip surface appearance after work roll change. This system achieves the highest operational flexibility as direct applications can be used at any time, independently for each mill stand. The mill automation system controls the use of the two systems, modulating the concentration and application for each stand. Confined jet dryer

To achieve the highest product quality and surface appearance, an innovative strip drying system was designed. In cold rolling, if there is a solution stain on the strip surface, the material has to be reprocessed or rejected

and the part of the coil with the defect is considered as scrap. At present no equipment is available on the market to completely solve this quality issue. Danieli Wean United, after intensive research and development by Danieli, has created an innovative device called Confined Jet Dryer (CJD) that, in addition to the equipment used to seal the exit strip gap of a rolling stand, is able to remove every droplet from the strip surface. This patent-pending solution is part of a robust drying system designed by Danieli and can be installed easily. Because of the small space requirements (less than 0.5 m), it can also be installed in existing rolling mills to apply this blow-off method to produce a spotlessly clean rolled strip. The system operates at the exit of the last stand for the top and bottom surfaces together with the new air blow off system mounted in the cobble guard. Two air knives are provided for each surface; the first for wiping and the second to confine all the droplets within the machine. Then, these are discharged through a vacuum hood mounted between the two knives. This solution can be applied to all cold rolling processes for any strip thicknesses, either at mill exit and/or processing lines. High speed exit section

Danieli heavy-duty flying shear, together with the carousel reel, ensures an endless rolling process, with cutting and threading speed up to 300mpm. The flying shear has two drums, top and bottom, which are held in parking position by the electric motor brake. During cutting, the drums are accelerated up to strip speed. Thanks to the Danieli design, all material grades and dimensions can be cut at a maximum speed of 300mpm, eliminating excessive mill slowdowns that could cause lower material quality in terms of shape, thickness and surface. The possibility to cut

Schematic layout for the mini Tandem Mill section

Tandem Cold Mill Section

48 Steel Insights, September 2012


technology at high speed and thread a new coil, thus avoiding strip defects in the mill, results from the specially designed carousel reel. The head threading position is extremely short and always in the same position, ensuring perfect coiling of the first wraps. The unloading of the finished coil is always performed in the same position, thus simplifying the coil handling system and lowering production costs. In addition, high-speed coil tailing and removal from the carousel will take place 25 seconds after the flying shearing, increasing thick gauge productivity. Conclusion

Successful implementation of this revolutionary mini PLTCM at Arvedi opens the market for such mills to global steel producers. It is particularly relevant in the present market scenario when more and more steel producers are implementing Thin Slab Casting and Rolling (TSCR) plants for production hot rolled coils. This has resulted to lower the average thickness of hot rolled strip availability. Moreover, use of high strength steel grades has been increasing rapidly with various conscious efforts by the

Danieli Heavy-duty flying shear

consumers going for “strength to weight ratio” while selecting their steel strips. With four TSCR plants already implemented and a few more in the pipe line, Indian steel

producers will also be very keen to take advantages of this mini PLTCM technology for production of high strength cold rolled strips at a very competitive cost. 

Sanat K. Bhaumik is senior vice-president (flat products), Danieli India. Note: The views expressed here are those of the author and not of Steel Insights. The publication does not take any responsibility for the article in part or in full.

Steel Insights, September 2012

49


Feature

NMDC hikes prices as supply constraints continue

This has resulted in downward revision of calibrated lumpy ore (CLO) prices by almost `700-1000/ton in the last one and half months, they said. CLO prices in the eastern region are currently around `8100/ton for ore of 65% Fe content. Because of low rainfall in Odisha region mining of iron ore remained unabated and there was no drop in mining as is the case in monsoon season. “This has resulted in higher inventory in the hands of the miners and consequent correction in prices,” they said. Although there is some amount of material lifting by big players like JSW, sponge iron makers are faced with high power costs and have reduced capacity utilization because of the low demand. “This has resulted in low lifting of material by the sponge iron makers,” they said. International prices

Steel Insights Bureau

I

ron ore miner NMDC Ltd has increased the contract price of the key steelmaking raw material by 8-13 percent for the July-September period to cash in on the current demand-supply mismatch scenario in the market. This is for the second consecutive quarter that NMDC has raised prices of the raw material in this fiscal. During the last quarter, it had raised iron ore prices by 8-10 percent on increased demand and lower availability. Following the hike, price of lumps with 65 percent iron content has gone up to `6,100 per ton and up to `3,000 per ton for fines containing lesser iron. Indian steel mills mostly use lumps. NMDC is the country’s largest iron ore producer. It has over 40 percent share of the domestic market. JSW Steel and Essar Steel are

50 Steel Insights, September 2012

NMDC’s leading customers in the country. NMDC had lowered iron ore price by up to `160 per ton for lumps and `600 per ton for fines in the last quarter of 2011-12 fiscal, after hiking the price in the previous quarter. A ban on mining in Karnataka for over a year now and the closure of some mines in Goa, Odisha and Jharkhand had impacted iron ore production. Total domestic production has come down to 169 million tons (mt) last fiscal and industry body FIMI expects it to reduce further to 140 mt in the current financial year. Steel majors had recently accused NMDC of charging higher prices for the domestic firms, while exporting at lower rates. Low lifting

Meanwhile, some iron ore miners in Odisha said they are witnessing low lifting of material because of the subdued steel demand in the country.

Internationally iron ore prices have fallen 28 percent this year, but traders said Chinese steel mills, the world’s biggest buyers, were waiting for prices to decline further with no signs that China’s steel demand will recover anytime soon. China’s economic slowdown is reducing the country’s demand for steel, iron ore and other commodities, raising the need for Beijing to launch more policy stimulus to ensure growth bounces back in the second half of the year. Sellers of imported iron ore to China cut prices drastically and the benchmark 62-percent grade iron ore is priced at $99 per ton in August end. Sources said prices would probably find support at about $70 per ton. BHP Billiton last week shelved two expansion plans worth at least $40 billion, blaming soaring development costs and falling commodities prices. Reports said analysts at Standard Chartered had cut its iron ore price forecast for the third quarter to $110 per ton from $130 previously, and for the fourth quarter to $115 from $160. It is expected that spot prices would stay below $100 per ton for a while before improving demand from steel mills pushes prices up around the end of September.


feature

Steel ministry asks SAIL to raise performance bar

Steel Insights Bureau

C

oncerned at the slackness facing the steel sector, the steel ministry has urged public sector steel major Steel Authority of India Ltd (SAIL) to take immediate steps to improve its performance. SAIL has taken up an ambitious `61,870-crore expansion and modernisation project to increase its production capacity to 21.4 million tons per annum (mtpa) from 12.8 mtpa. But the implementation has been considerably delayed due to multiple reasons. “The ministry has expressed its concern over the fact that production of crude steel in 2011-12 has been lower by 3 percent over the corresponding period of the previous year,” an official of the ministry told Steel Insights. SAIL’s crude steel production the year 2011-12 was 13.35 million tons (mt) as compared to 13.76 mt in 2010-11. The company had earlier said its production had declined during the year mainly due to repairs of blast furnace and coke oven batteries at Bhilai Steel Plant and also because of frequent

4.61 mtpa from 4.36 mtpa. The capacity of Durgapur Steel Plant will increase to 2.20 mtpa from 1.80 mtpa and that of Rourkela Steel Plant to 4.20 mtpa from 1.90 mtpa. The expansion plan of Rourkela Steel Plant is at an advanced stage and is likely to be completed within schedule. In case of expansion of IISCO Steel Plant, Burnpur, difficult and unforeseen soil conditions, removal of underground boulders and hillocks etc. led to substantial increase in civil and structural work and also entailed extra time, the ministry official pointed out. In case of Bhilai Steel Plant (BSP) expansion, the timelines were affected due to inadequate deployment of manpower, lack of technically competent/skilled manpower and non-deployment of modern and robust equipment by the contractors, he said. Commenting on the delay, an official of SAIL said the company has already taken various measures for expediting the project works including enhancing delegation of powers for faster decision making, strengthening of project management

power disruptions at the Bokaro Steel Plant. Meanwhile, it is expected that the expansion at SAIL’s five integrated steel plants at Bhilai, Bokaro, Rourkela, Durgapur and Burnpur and special steel plant at Salem to enhance production capacity in the first phase to 21.4 mtpa is likely to be completed by 2013, the official said. Post completion of expansion project, the installed crude steel capacity of Bhilai Steel Plant will go up to 7 mtpa from 3.93 mtpa and that of Bokaro Steel Plant to

Steel Insights, September 2012

51


fEATURE

SAIL’s Aug output up 7% y-o-y SAIL has produced 1.16 mt of crude steel in August 2012, recording a growth of 7 percent as compared to the amount produced during corresponding period of last year, the company said in a statement. The cumulative production of crude steel by SAIL stood at 5.65 mt during April-August 2012, up 3 percent over corresponding period of last year. With continued thrust on improving techno-economic parameters aimed at cost competitiveness, blast furnace productivity of the company in August 2012 was up by 9 percent on a year-onyear basis whereas concast production as a percentage of crude steel grew by 4 percent. 

SAIL reviewing decision on Manhar

organisation by recruiting or redeploying fresh and experienced project managers, assistance to contractors in the form of supply of steel, pipe and other SAIL products, provision of space for fabrication yard inside and outside the plant to facilitate

52 Steel Insights, September 2012

the contractor in fabricating structures and reducing transportation delays. It has also set up a board sub-committee to review the physical and financial progress of the modernisation and expansion plans, the company official said.

Meanwhile, SAIL is reviewing the proposal to set up a Steel Processing Unit (SPU) at Manhar in Vaishali District of Bihar since the project has been found to be financially unviable, an official said. The land identified for Manhar SPU has been found to be low lying and thus significant land filling is required, the official said, adding, “as a result of which the project is financially unviable and is under review.” SAIL had laid the foundation stone for setting up of the SPU at three locations in Bihar at Bettiah in West Champaran District, in November 2007, and at Gaya and Manhar in December 2008. The company has already set up the SPU at Bettiah and has acquired land for the remaining two locations. However, in case of SPU at Gaya, the permission for change of land use is awaited from the state government. As far as the Bettiah unit is concerned, the company has completed integrated trials of pipe plant and corrugation unit and has already received orders from Central Marketing Organization (CMO) for production of pipes, the official said. 


fEATURE

Ferro alloy makers in West Bengal seek power benefits Steel Insights Bureau

F

erro alloy makers in West Bengal, passing through a cut throat competition period, due to weak demand from all across the globe, feel that the state government should provide them power at a concessional rate to help them compete and survive. “Almost all ferro alloys makers in India, particular those who do not have linked mines, are in very bad shape. All the manufacturers are making losses, banks are squeezing their limits, raw material cost are not coming down, power rates are going up, labour costs are going up and under that sort of situation companies are under pressure to shut down their plants,” an official of a leading manufacturer with plant in West Bengal said. He pointed out that a number of manufacturers in West Bengal have cut down their production by around 50 percent as selling price has come down to such a level where recovering the cost has become difficult. “Unless we increase prices to recover at least our variable and fixed cost, the survival has become very difficult,” the official said, but accepted that it is difficult at this point of time to increase the prices unless all the manufacturers agree. Arguing for the supply of power at special rates, the official pointed that power accounts for almost 40 percent of cost of production of ferro alloys. “There is no raw material in West Bengal, except power. So if the manufacturers do not get at least power incentive, it will be very difficult for industries to operate and survive in the state as manufacturers in other states like Orissa, Chhattisgarh and Andhra Pradesh have the advantage getting raw material at low cost,” the official said. “Today if you go to Orissa, you will at least find some minerals, some materials like coal, but there is nothing in West Bengal.

In such a situation, the ferro alloy industry in West Bengal should at least get power incentive,” he argued. According to an estimate, around 10 people are required to operate 1 MVA plant. Today in West Bengal, the total installed capacity is not less than 500 MVA, so the industry is providing direct employment to about 5,000 people and indirect employment to another about 25,000 people. In support of their argument, an official of another ferro alloy maker said, a majority of 500 MVA production of alloys from West Bengal is exported, which brings in substantial amount of foreign exchange for the country. Not only this, the industry pays, VAT, excise and other taxes, but it also provide employment to a large number of people in backward areas.

South Indian power crisis hits industry Acute shortage of power in most of the Southern Indian states is severely affecting ferro alloys producers in the region, industry sources said. “We are operating with only one of the two furnaces because of power related issues. There has been no improvement in power scenario since July,” an official of Rohit Ferro Tech, a leading ferro alloy maker said. “The situation is very bad out there. We get power only during five days of the week. During peak hour they only provide lighting load just to heat the furnace and for the remaining two days there is absolutely no power,” he said. Incidentally, a large number of ferro alloy plants, including those of Abhijeet Group (22 MVA x 8) and Maithan Group (34 MVA), operate in southern India.

Current situation

The overall ferro alloys market is very weak at present because of low demand from Europe and China. Europeans are expected to be back in market from September. It is expected that European buying will emerge once the people back there start coming back from their holidays by early September. Industry officials in India expect that after the European officials are back from their holidays they will start picking up the material because they will have to stock for the fourth quarter. There is no stock of

Steel Insights, September 2012

53


fEATURE Indicative prices of ferro alloys Price as on August 20, 2011

Price as on August 17, 2012

Price as on July 2, 2012

Price as on April 19, 2012

Price as on December 15,2011

Price as on August 2011

Silico Manganes (60-14)

$1000

$950

$1100

$1150

$850

$1100

Silico Manganese (65)

$1100

$1050

$1200

$1250

$950

$1200

Ferro Manganese (70)

$975

$925

$1020

$1100

$820

$1080

Ferro Manganese (75)

$1050

$1000

$1080

$1150

$950

$1180

NA

$0.93 (European Grade) and $0.89 (Chinese Grade)

$0.95

$1.05

$0.90

$1.05

$1325

$1250

$1300

$1450

$1200

$1400

Name of Alloy

Ferro Chrome (60) Ferro Silicon (70 percent)

material with most of the steel makers in Europe and as such they will have to buy. On the other hand, the situation in China is not that good. Their economic growth rate is down and interest rates have shot up. There are also rumours about banking issues in China. An official of a leading ferro alloys exporting company said, “It is for the first time that China is also under pressure as growth rate is very low and their banks are in very bad shape. Their currency is also fluctuating. A lot of traders, who were earlier doing very good work, have all run away. In addition, there have been reports of defaults.” Prices

Meanwhile, faced with a situation of higher raw material cost, power cost and lobour cost, a number of ferro alloy makers in India have increased the prices of various alloys by between $50 and $75 per ton with effect from August 20, according to information

54 Steel Insights, September 2012

available with Steel Insights. “All the manufacturers are making losses, and finally, they have decided to increase the prices for their survival or to recover at least their fixed cost. The revised prices came into effect from August 20,” an official of a leading ferro alloy maker in West Bengal said. However, a section of traders felt that the market, particularly Japanese and European buyers, may not accept the increased prices because of continued weakness in steel demand. In addition, the attempt of ferro alloy makers may backfire, considering the fact that a few Indian companies have recently increased their production on their own and through conversion basis, they said. Steel Insights learnt that Tata Steel, which has its own captive manganese ore and chrome ore mines, had recently entered into conversion deal with Haldia Steels. Following this, Haldia Steels is believed to have offered two of its three plants to Tata Steel for conversion basis.

“The increased availability of alloys may put pressure on ferro alloys makers and they may be forced to roll back the hike,” a trader said. Incidentally, the prices of all types of ferro alloys had fallen sharply during the first quarter (April-June) 2012-13 on weak demand from Europe and South East Asia and fell further in July and August. On one hand the prices of ferro alloys have softened, the domestic price of chrome ore has remained unchanged. The price fixed by Odisha Mineral Corporation (OMC) for July-September quarter was unchanged at April-June quarter price of Rs 11000 per ton. Meanwhile, the price of imported chrome ore remained unchanged in August after softening a bit to $260 per ton for 4044 grade and that of 40-42 grade to $240 per ton fob as on July 2, 2012 compared with a price of $275 and $265 per ton for respective grade as on April 19, 2012. 


feature

Spot coking coal prices ease sharply in August Steel Insights Bureau

S

eaborne spot coking coal prices fell sharply in August on lack of demand from Europe and India. Premium lowvol HCC was quoted at $160 per ton fob Australia on August 28 compared with $181 per ton on July 31. Mid-vol hard coking coal with 64% CSR (coke strength after reaction) fell to $139 per ton fob Australia, down from $157 per ton fob on July 31. Sources said both in India and Europe there were limited buyers and little confidence in the market. Buying interest in Europe was scant with the Europeans on their summer holiday and mills in the region making the biggest production cuts. Meanwhile, settlement of BHP Mitsubishi Alliance labour unrest has proven to be detrimental to the interests of Australian miners. This has resulted in rebound in supply thereby hurting price sentiment. Sources said the major purchasers from India and China have been reticent owing to monsoon and cheaper availability from domestic and Mongolian sources. However, the reticence in the market is not expected to last long. Indian majors cannot postpone buying for more than a month with inventory levels depleting fast.

Moreover, with the end of monsoons in September, construction activity is expected to pick up resulting in more demand for steel. Going against the trend, some Indian companies have been quick to grab this opportunity in a soft market. SAIL had issued a fresh tender for 50,000 tons of low ash metallurgical coking coal while MMTC Ltd issued two tenders for 120,000 tons of coking coal. It can be termed as testing the market before they come up with major requirement. December contract prices

Sources said the contract price may drop 11 percent to $200 per ton in the OctoberDecember quarter or below $200 per ton from $225 per ton in the July-September quarter. A deepening debt crisis in the Eurozone has dragged down demand and prices of commodities, forcing the world’s largest steelmaker ArcelorMittal to shut down or idle plants in the region. Slowing economic growth in China, the second-biggest importer of metallurgical coal, has increased chances of output cuts at mills and further shrinkage in demand for the fuel. Possible higher supplies will also put pressure on prices after the BHP Coking coal FOB Australia ($/ton) Billiton Mitsubishi HCC Peak Premium HCC 64 Low Vol Low Vol 12 Semi Date Alliance, the Down Region Low Vol Mid Vol PCI Ash PCI Soft world’s biggest 5-Jul 219.00 219.50 175.50 145.00 127.50 109.50 exporter of 11-Jul 215.50 216.00 171.00 143.00 128.00 105.50 s t e e l m a k i n g 18-Jul 210.00 210.50 170.50 139.50 126.50 104.50 coal, resumed 24-Jul 190.50 191.00 165.00 138.00 116.00 102.50 operations last 25-Jul 187.50 188.00 163.50 136.50 113.00 102.50 month at its 26-Jul 181.50 182.00 158.00 132.50 109.00 95.50 Queensland mines, 31-Jul 181.00 181.50 157.50 128.50 104.50 95.50 pruning the risk 2-Aug 180.00 180.50 157.50 128.00 104.50 96.00 of shortages. If 3-Aug 180.00 180.50 157.00 128.00 104.50 96.00 benchmark prices 17-Aug 166.50 167.00 146.50 116.00 99.00 108.00 fall below $200 23-Aug 162.00 162.55 139.00 114.50 96.50 104.00 per ton because 28-Aug 159.50 160.00 139.00 114.00 98.50 101.50 of receding

SAIL seeks more coal blocks In an effort to get at least 25-30 percent coking coal from indigenous sources, SAIL has approached the government seeking allotment of more coal blocks. The company is targeting to get 7/8 million ton (mt) coking coal from indigenous sources. At present, out of its total requirement of 14 mt, the company has managed to source about 3.5 mt of coking coal mainly from CIL besides its own mines. At present, the company has to spend a whopping Rs 12,000 crore for importing around 11 mt coking coal. SAIL’s requirement of coking coal would go up to 21 mt when its capacity would increase to around 24 mt from the existing 14 mt by next year. SAIL had got two coal blocks at Jharia coal belt in Jharkhand and has approached the government for some more coal blocks in Jharia. demand from China – the world’s biggest Ssteel producer and consumer – coking coal suppliers including BHP, Rio Tinto, Teck Resources Ltd. (TCK) and Alpha Natural will start cutting output to support prices, industry sources and analysts feel. Meanwhile, global steel demand growth is forecast to slow to 3.6 percent this year from 5.6 percent in 2011, according to the World Steel Association (WSA). China may consume 648 million tons (mt) of steel this year, compared with 657 mt forecast in March, according to Australia’s Bureau of Resources and Energy Economics. Meanwhile, many steel makers globally have taken a wait-and-watch mode, anticipating prices to fall further. Met coke

Lack of buying appetite continued to characterise the metallurgical coke market. Coke with 12.5 percent ash was quoted at $338 per ton, down from $360 per ton cfr east India a month earlier. In India, met coke prices hovered around `19,600 per ton in the eastern region, sources said. 

Steel Insights, September 2012

55


fEATURE

Auto sector growth slows down Steel Insights Bureau

T

he recent slowdown in India’s industrial growth, the unprecedented power outages and month-long strike at Maruti Suzuki’s Manesar plant led to a slowdown in the automobile sector’s growth rate in July. As per data available from the Society of Indian Automobile Manufacturers (SIAM), the Indian auto industry recorded a 5.5 percent growth in July over the same month a year ago. For the first four months of 201213 (April-July), the growth rate was 7.10 percent, lower than the 7.65 percent growth reported for the first quarter (April-June) this year. While this fall may be marginal, the performance so far this year belies SIAM’s forecast of 11-13 percent by a wide margin. Moreover, the industry association actually sees signs of a slowdown in recent numbers. The cumulative production data for April-July 2012 shows the industry produced 1,746,840 vehicles in July 2012 as against Auto sector growth forecast for 2012-13 (%) Category

FY13

Cars

9-11

UVs

29-31

Vans PV Total

3-5 11-13

LCV Goods

16-18

MHCV Goods

(6)-(8)

Passenger Buses

9-11

CV Total

6-8

1,656,014 in July 2011. The overall growth in domestic sales during April-July 2012 was 9.34 percent over same period last year. Passenger Vehicles segment grew at 10.20 percent during April-July 2012 over the same period last year. Passenger Cars grew by 5.55 percent, Utility Vehicles (UV) was up 53.66 percent and Vans grew by a negative -12.73 percent during April-July 2012 as compared to the same period last year. During the first four months, the overall Commercial Vehicles (CV) segment registered a growth of 4.74 percent year-onyear. While Medium & Heavy Commercial Vehicles (M&HCVs) registered negative growth at (-12.75) percent, Light Commercial Vehicles grew by 18.02 percent. According to SIAM data, three-wheeler sales recorded marginal growth at 0.81 percent in April-July 2012. Passenger carriers grew by 4.93 percent during April-July 2012 and goods carriers registered de-growth at (-13.62) percent during this period. Two-wheelers registered a growth of 9.75 percent during April-July 2012. Mopeds, motorcycles and scooters grew by 4.02 percent, 6.35 percent and 26.71 percent respectively in the period of April-July 2012.

2W

11-13

3W Goods

(1)-1

Exports

3W Passenger

1-3

3W Total

0-2

Auto Total

11-13

Export performance during the first four months was rather dismal. During AprilJuly 2012, overall automobile exports from the country registered negative growth at

Source: SIAM

56 Steel Insights, September 2012

(-4.03) percent. While Passenger Vehicles and Commercial Vehicles both grew by 9.14 percent, Two & Three wheelers declined by (-1.00) and (-39.23) percent respectively in April–July 2012 compared to the same period last year. M&M, Tata Motors

Meanwhile, leading automakers Tata Motors and Mahindra & Mahindra (M&M) reported high growth in sales during July 2012 versus the same month last year. Mahindra, India’s leading SUV manufacturer, has recorded total auto sales of 47,059 units during July 2012 as against 39,633 units during July 2011. The company’s domestic sales stood at 42,799 units during July 2012, as against 37,323 units during July 2011 recording an increase of 15 percent. The Passenger Vehicles segment (which includes the UVs and Verito) has registered a growth of 27 percent, having sold 22,011 units in July 2012, as against 17,312 units during July 2011. “We are happy to have achieved a growth of 19 percent during July 2012 in spite of difficult and uncertain market conditions continuing. Incidentally, July 2012 is the second highest monthly sales for us. The auto industry needs to be concerned about slower economic expansion and consumer sentiments which are not so positive,” said Pravin Shah, chief executive, automotive division, Mahindra & Mahindra Ltd.


fEATURE

Maruti reopens plant, alters strategy Steel Insights Bureau

A

bout a month after the lock-out, Maruti Suzuki India Ltd (MSI), the country’s largest automaker, resumed operations at its Manesar plant (Haryana) on August 21 amid tight security. Production began in a phased manner with limited roll-out and sparse attendance. Initially, about 150 cars were expected to be rolled out every day instead of the plant’s normal capacity of 1,5001,700 units. However, production would be gradually ramped up at the plant, which has an annual capacity of 5.5 lakh units. The labour violence and subsequent lock-out has prompted a number of serious measures from the management. The company has taken a firm stand on labour issues. It has decided to terminate services of 500 permanent workers, who were allegedly found to be involved in violence inside the plant. Besides, MSI is also said to be planning to remove another 500 contract workers over their alleged role in the violence and arson. Going forward, the

“A cut in interest rates would have helped lower the cost of manufacturing and product, thereby improving industry confidence,” he added. Tata Motors, on its part, reported 19

company has decided not to hire contract workers for its plant operations. The second major decision was of increasing the level of plant automation. MSI has planned to go for 99 percent automation in the press shop where steel sheets are moulded into door frames and then passed onto the weld shop to hinge them onto the body of the vehicle. The idea, according to company sources, is to being its Manesar operations on par with Suzuki’s hi-tech plants in Japan. Over the years, the carmaker has been steadily increasing automating of its plants in India. In over a decade, the company has reportedly doubled the number of robots used in its plants to around 1,500. It will add another 50-100 new robots in the older plant at Manesar to increase automation to 99 percent from the current 90 percent, reports said. Maruti has also increased the automation level at its three plants in Gurgaon to 60-65 percent in the past few years. The company had stopped operating two manual production lines at Gurgaon

percent growth for July 2012 to 101,605 units. This was led by 41.4 percent y-o-y growth in the domestic passenger vehicle (PV) sales. Jaguar and Land Rover (JLR), however,

Maruti July sales up 9.2% y-o-y Maruti Suzuki India Limited sold a total of 82,234 vehicles (including 11,210 units for export) in July 2012, recording a rise of 9.2 percent in sales from 75,300 vehicles sold during the corresponding month of the previous year, the company said in a statement. However, Maruti Suzuki India’s export rose by 27.4 percent in July 2012 to 11,210 units from 8796 units in the year-ago period, the statement said. On a year-on-year basis, during the first four months (April-July) of the current financial year, the company’s total auto sales rose by 6 percent to 378,130 as compared to 356,826 vehicles sold during the corresponding period of 2011-12. in an effort to move to fully automated operations. Apart from achieving manufacturing excellence, the increased automation will reduce human intervention into the production process, the sources said. Meanwhile, the production loss during the strike would significantly affect the company’s second quarter results, analysts feel. The plant suffered damages estimated at around `10 crore, while the overall production loss during the lockout was pegged at around `1,400 crore. Analysts expect the shutdown to impact the second quarter financial performance sharply as the Manesar plant which produces the in-demand products, Swift and Dzire, is expected to cost the company `2,200 crore in top-line during the quarter. Nonetheless, re-opening of the plant is a positive development and will enable the company to ramp-up in time to meet the festival demand. The automobile sector and Maruti in particular is a major consumer of products from prime steel mills in India.  posted lower-than-expected volume growth of 40.8 percent y-o-y to 26,921 units. While Land Rover volumes jumped 55 percent y-o-y to 22,857 units led by Evoque sales; volumes were down by 6.3 percent m-o-m. 

Steel Insights, September 2012

57


fEATURE Country-wise imports

April-July steel imports up 53% y-o-y

(in 000 tons)

Country

scrap import growth of 82 percent, electrical sheet import growth of 74 percent year-onyear and HR Coil/strip import growth of 61 percent year-on-year. Among the non-flat items, billet and slab imports grew 231 percent on year-onyear basis, while structural imports grew 108 percent year-on-year. The import growth till July eclipsed the 43 percent increase in the first three months (April-June 2012). Total imports during the first quarter stood at 2.151 mt, compared to 1.5 mt recorded for the same period last year. Among the origin countries, China topped the list with total export of 717,000 tons during the first four months of 201213. The volume of imports from the neighbouring country was up 76 percent compared to 408,500 tons exported during the same period last year. Exports from Korea increased by 65 percent to 563,000 tons during April-July 2012, against 340 mt recorded for the same period last year. Imports from Japan stood at 429 mt, while that from Russia was 184 mt for the period under review.

Steel Insights Bureau

I

ndia’s steel imports continued to show an uptrend during the month of July even as the domestic manufacturers faced a demand slump. Total imports of finished steel were up 53 percent year-on-year during the first four months (April-July) of the current fiscal year, according to provisional data released by the steel ministry. Total imports during the period stood at 2.88 million tons (mt) compared to 1.88 mt recorded for the same period last year. Of the total imports, the contribution of the non-alloy steel segment was 2.23 mt (decline of 56 percent) while the rest was the share of the alloy steel segment (including stainless steel). Overall, scrap, alloy steel and HR coil/strip made up most of the imports in the April-July 2012 period. Import of flat products increased by 51 percent to 2.49 mt during April-July 2012, compared to 1.65 mt imported during the corresponding period last year, the data showed. In the flat segment, plate imports rose 100 percent year-on-year, followed by

Estimated production, import, export, consumption (in 000 tons)

Producers

12-Jul

12-Jun

Variation %

11-Jul

853

794

7.4

806

5.8

RINL

236

167

41.3

247

-4.5

Tata Steel

533

458

16.4

444

20

Other producers

1857

1826

1.7

1793

3.6

Secondary producers

3674

3768

-2.5

3747

-1.9

795

799

6358

6214

2.3

6214

2.3

558

476

17.2

471

18.5

301

338

-10.9

492

-38.8

6615

6352

4.1

6193

6.8

-2.5

6272

-2.1

5897

Total production Imports Exports Availability Variation in stock

-246

-682

Apparent Consumption

6861

7034

Less: Double counting Real consumption Source: Steel ministry

58 Steel Insights, September 2012

490

525

6371

6509

Apr-Jul 2011

Growth (%)

China

717.28

408.49

76

Japan

429.3

258.78

66

Korea

563.06

340.31

65

Russia

184.79

120.05

54

Ukraine

173.82

140.61

24

Others

1045.56

718.04

46

Total

3113.81

1986.28

57

Source: Steel Ministry

Port-wise imports (in 000 tons)

Port

Apr-Jul 2012 (prov.)

Apr-Jul 2011

Mumbai

1088.12

746.61

46

Kandla

359.62

228.04

58

Growth (%)

Chennai

493.68

407.37

21

Others

1172.39

604.26

94

Total

3113.81

1986.28

57

Source: Steel Ministry

Most of the steel import was done through Mumbai port, which saw a 46 percent increase in cargo volume to 1.09 mt, compared to 746,000 mt handled during the same period last year. Kandla port which handled around 359,000 tons of steel during the period, saw a 58 percent increase over 228,000 mt imported during the same period last year. Steel consumption, exports down

Variation %

SAIL

Less: Own consumption

Apr-Jul 2012 (prov.)

823

-79 9.4

375 8

While imports showed 53 percent growth, India’s steel consumption in July 2012 fell 2.1 percent to 6.37 mt, compared to 6.50 mt consumed in June 2012, according to the provisional data. However, steel consumption in April-July 2012 was up 7.7 percent yearon-year to 24.37 mt from 22.62 mt consumed in the same period last year. Finished steel production in April-July period rose 3.3 percent year-on-year to 25.01 mt, against 24.21 mt in the same period last year, the data showed. Steel exports in July 2012 fell 10.9 percent to 301,000 tons compared to 338,000 tons in the same period last year. Exports during April-July 2012 also dropped 22.9 percent year-on-year to 1.29 mt, compared to 1.67 mt in the same period last year. 


fEATURE

Ferro alloy prices show marginal uptrend

nevertheless a price increase of about 2 percent for producers. Producers have been forced to reduce material consumption by 40 percent in the past few months because of low demand but expressed confidence that it should slowly recover by October, saying nothing significant is expected in September because not much order enquiries have been received. As steel production is still low, producers had to suspend production for the export market â&#x20AC;&#x201C; mainly to the Middle East, and focus on strengthening sales in domestic market though not with good result yet because of rampant power shortages. Ferro-silicon

Anondo Kumar Dutta

F

erro alloy prices remained stable to firm in the month of July, even as demand remained largely lukewarm and thus buying also remained low. Ferro-chrome

Ferro-chrome supplies have suddenly dropped as the atrociously high power tariff of MSEDCL for industries has now made more than 10 ferroalloy units in Nagpur district to submit applications for permanent disconnection. The power rates in Chhattisgarh and Andhra Pradesh are about half than that of Maharashtra. Due to this difference, the local Fe-Cr is costlier by `12,000 per ton whereas margins are only about `500 per ton. Traders are currently negotiating prices at `61000-64000 (ex-works). With the future of these mills looking weak, prices are expected to rise in the near future, though some dealers are already looking at the export market for comfort.

Ferro-molybdenum

Buying activity in the ferromolybdenum market is low, and although dealers have raised asking price to `1060 per kg, this was caused by more retail enquiries in spot market but rather to account for increasing cost of production. Mainstream prices were firm in the range of `1030-1060 per kg but converters and traders acknowledge material supply is not tight and regular buyers continue to take normal delivery. The market is less active and the tight ferromolybdenum supply in Europe will soon be over as price could adjust to stability because there is no such strong end-user demand in the domestic market. The market is stable but producers expect to see higher quotations within a span of two weeks. Ferro-manganese

High-carbon ferromanganese offer prices are up to `54,000 per ton ex-works, but endusers that make direct purchase confirmed deals at `52500 per ton ex-works, which is

Ferro-silicon producers have agreed upon new firm quotations after September 5, and although traders could make new bookings before that at the current price of `66500 per ton, this price is all but nominal as traders reported unsuccessful attempt to get material. The current retail price of `72000-74000 per ton ex-warehouse in North India has not received much patronage from wouldbe buyers and it is possible producers might review their prices downward by another `500-1000 per ton to boost demand. However, in the face of continued weak demand from end-users, producers would continue to be under pressure until there is recovery in steel production as ferrosilicon producers cannot rely on foreign demand alone as being sufficient to lift the market. Silico-manganese

Production planning by steel mills is good for the coming months and silico-manganese producers are more to benefit from improved demand, just as it is clear prices have stopped falling and should rise, albeit marginally, from the current range of `52000-53000 per ton ex-works for Si-Mn 60/14 and US$ 1030-1050 per ton fob India for 65/17 grades. In the retail business, some traders have suddenly stopped offers or have raised their workable quotations by `1000 per ton to `58000 per ton ex-warehouse and claim high cost of borrowing as producers are reluctant to advance any credit below the purchase quantity of 2000 tons. On the future trend, traders and producers are upbeat but are not necessarily focusing on price hike but as more activity takes place with increased sales turnover, revenue is maximized at small margin.â&#x20AC;&#x201A;

Steel Insights, September 2012

59


social buzz

ISMW welcomes reopening of ore mines, denounces illegal mining Steel Insights has started a group on LinkedIn called India Steel Market Watch (ISMW). The readers are welcome to join the group and participate in daily conversations and surveys conducted by ISMW on the online forum. Steel Insights may, at its discretion, publish the results of such surveys and discussions for the benefit of a larger audience. Steel Insights Bureau

F

or the Indian steel industry, the big news at the moment is the reopening of iron ore mines in Karnataka. On September 3, the Supreme Court allowed 18 mines in Karnataka to resume iron ore output. While welcoming the move, members of ISMW said this has come as a much needed relief to the ore miners. It should also delight the domestic steel community. That is so because the additional output from these mines, estimated at around 5 million tons per annum (mtpa), is more is more likely to help domestic steel makers than find its way onto weak global markets. The exports of ore, meanwhile, is likely to see a sharp decline to 45-46 mt in 2012-13, industry sources said. This implies a 15 mt drop from 60 mt of ore exported in 2011-12. Nevertheless, the export of low grade fines is here to stay, they said. Until 2010, India was the world’s third largest iron ore exporter, with China being its largest market. The clampdown on illegal

mining in 2010 and government’s measures to keep output for domestic steel mills have slashed exports almost by half. Illegal mining, farmers’ woes

Although rejoicing the court decision, the steel community was not happy about the ill effects of illegal mining on the community and farming sectors. A report posted by a member showed how rampant mining, including illegal excavation of iron ore in the mineral-rich Bellary district in the last 10 years, has severely dented the agricultural output, causing an annual loss of Rs 200 crore. A study conducted by the Hyderabadbased Cerena Foundation and Samaja Parivarthane Samudaya (SPS), the NGO which brought the issue of illegal mining in Bellary to the Supreme Court’s notice, reveals drastic decline in the production of maize, jowar, bajra, groundnut and mango in the last 10 years because of pollution and loss of soil fertility in mining areas. A member of ISMW said the states should toe the line of Gujarat to choose the right path to growth and development. “We together should think and analyse” the factors that helped Gujarat prosper while other states struggled to grow, he said. Belated rains, slack market

On the domestic front, however, slack demand conditions continued to frustrate

60 Steel Insights, September 2012

the small and large domestic steelmakers. The belated monsoon, sluggish economic growth and lack of credit for investment in construction and infrastructure posed major hurdles for the industry in the month of August. The slump in demand is affecting steel prices. A 1 percent drop in steel prices in August was on expected line in the backdrop of economic gloom. Meanwhile, most of the steel majors have suffered substantial drop in first quarter (Q1) profit. According to reports, the drop in steel consumption from 8.4 percent in Q1 to 7.7 percent in July is just “shadow of the gloom staring”. Commenting on the issue, Balram Sharma, propreitor at ABM Sourcing, said “In our country the tax structure also plays a major role in industry sector. Every fifth year term a lobby sits and discusses the reforms but unfortunately when the final booklet – the so called BUDGET – is packed and sealed and reopened, it narrates that the reforms moving a different way.” BIS registration

A n o t h e r development that drew the attention of members at ISMW was the new quality regulation for the steel sector. The steel ministry has recently announced that it has no plans to defer the September 12 deadline for a new government quality-control order although many foreign steelmakers are yet to have their material certified by Bureau of Indian Standards (BIS) as the new regulation mandates. But certain corrective measures could be taken if enough foreign mills have not registered for a particular product. A decision on this would be taken in the first week of September, reports said. The regulation requires both domestic and foreign suppliers of certain steel products to have their material certified by BIS. But the bureau admits it may not be able to complete the registration process for all applicants, especially foreign mills, before the September 12 deadline. Meanwhile, Indian steel importers are worried that the government quality-control regulation will impact imports when it takes effect. 


logistics

Iron ore handling by major ports down 35.8% y-o-y in April-July Steel Insights Bureau

M

ovement of iron ore through the 12 major ports of India showed a significant drop of 35.89 percent in the first four months (April-July) of 201213, due to restrictions imposed on mining and a hike in export duty on iron ore. The major ports together handled 15.26 million tons (mt) of iron ore in the AprilJuly period compared to 23.80 mt handled in the same period last year, according to data released by the Indian Ports Association (IPA).

Mormugao port handled the highest volume of 7.36 mt of iron ore in AprilJuly. This volume, however, Traffic handled at major ports was about 29.90 percent lower (During Apr-Jul, 2012* vis-a-vis Apr-Jun, 2011) than the iron ore traffic moved (*) Tentative (in ‘000 tons) through the port in the same April to July Traffic % Variation period last year. Ports against prev. The ports handled a total of 2012* 2011 year traffic 183.66 mt of traffic during the KOLKATA period, 4.89 percent lower than 193.10 mt recorded during the Kolkata Dock System 3785 4234 -10.60 same period last year. Haldia Dock Complex 9756 11555 -15.57 According to the data, the ports handled a total of 9.95 TOTAL: KOLKATA 13541 15789 -14.24 mt of coking during the period, PARADIP 16194 19875 -18.52 down 9.20 percent as compared VISAKHAPATNAM 20619 24220 -14.87 with 10.96 mt handled in the same period last year. ENNORE 5422 4236 28.00 However, the movement CHENNAI 18382 20152 -8.78 of thermal coal through the V.O. CHIDAMBARANAR 9536 9462 0.78 major ports was up 4.44 percent to 17.29 mt during COCHIN 6921 6379 8.50 April-July, compared to 16.55 NEW MANGALORE 11227 11493 -2.31 mt achieved in the same period MORMUGAO 10637 13639 -22.01 last year. Movement of container MUMBAI 19730 18038 9.38 traffic in terms of tonnage and JNPT 22221 21595 2.90 TEUs showed an increase in the KANDLA 29231 28231 3.54 April-July period. The major ports handled 41.07 mt of TOTAL: 183661 193109 -4.89 tonnage and 2.61 million TEUs

in April-July period compared to 39.80 mt of tonnage and 2.60 mt of TEU in the same period last year. Among the major ports, Paradip port had the distinction of handling the highest volume of thermal coal of around 5.67 mt in April-July period. Visakhapatnam port handled the highest quantity of 2.31 mt of coking coal during the period. Movement of coking coal through Paradip, Kolkata, Visakhapatnam, Chennai, Cochin and Mormugao ports declined during the period when compared to the corresponding period last year. Six major ports showed positive growth in traffic handling during the April-July period of the current fiscal, while the remaining six showed negative growth on a year-on-year basis. In terms of growth, Ennore port topped the list with a 28 percent increase in cargo throughput. V.O. Chidambarnar port’s growth was lowest at about 0.78 percent during the period. In terms of traffic volume, Kandla port clinched the top rank with a cargo volume of 29.23 mt recorded for the period. The Mormugao port registered the highest decline of 22.01 percent in traffic handling during the period due to fall in iron ore export. 

Steel Insights, September 2012

61


Logistics

Railways commodity freight revenue down 6.3% m-o-m in July Steel Insights Bureau

T

Commodity-wise revenue Commodity

Quantity (In mt) July’11

Earning (`cr)

July’12

July’11

July’12

Coal i) for steel plants

4.3

4.15

172.08

223.41

ii) for washeries

0.12

0.09

1.49

0.78

23.69

24.85

1500.71

1898.73

9.12

10.27

469.84

579.25

37.23

39.36

2144.12

2702.17

1.28

1.33

93.02

114.86

i) from steel plants

2.09

2.36

243.57

364.45

ii) from other points

0.63

0.59

50.75

38.79

iii) Total

2.72

2.95

294.32

403.24

iii) for thermal power houses iv)for public use v) Total Raw material for steel plants except ore Pig iron and finished steel

Iron ore i) for export

1.47

0.83

372.79

187.3

ii) for steel plants

4.41

5.32

145.8

219.44

iii) for other domestic users

3.79

3.68

218.64

264.65

iv) Total

9.67

9.83

737.23

671.39

Cement

8.27

8.18

464.31

587.09

Foodgrains

3.74

3.83

343.05

499.83

Fertilizers

4.35

4.09

314.8

374.18

Mineral Oil (POL)

3.63

3.92

286.34

413.72

Container Service i) Domestic containers

0.7

0.67

69.11

66.54

ii) EXIM containers

2.41

2.67

201.05

234.07

iii) Total

3.11

3.34

270.16

300.61

Balance other goods

5.66

5.38

365.51

420.85

79.66

82.21

5312.86

6487.94

Total revenue earning traffic

62 Steel Insights, September 2012

Sayanti 0916334819 he Indian Railways’ revenue earnings Kam from commodity-wise freight09009777860 traffic fell month-on-month in July due to lower transportation of coal and cement. Revenue earnings from commoditywise freight traffic during July 2012 stood at `6487.94 crore, down 6.32 percent compared with `6,925.5 crore earned in June, according to information available with Steel Insights. Revenue from transportation of iron ore for exports, steel plants and for other domestic user in July fell to `671.39 crore, down 0.11 percent from `672.1 crore in June. However, the quantity of iron ore transported rose to 9.83 mt in July from 9.61 mt in the previous month. The Railway’s revenue from transportation of coal fell to `2702.17 crore in July from `3,017.4 crore in June. The Railways transported 39.36 million tons (mt) of coal in July compared with 39.26 mt transported a month ago. Revenue from transportation of cement in June stood at `587.09 crore (8.18 mt) from `650.82 crore (8.15 mt) in June. Revenue from transportation of petroleum oil and lubricant (POL) in July stood at `413.72 crore (3.92 mt), while the same from pig iron and finished steel from steel plants and other points was `403.24 crore (2.95 mt). Revenue from container services was `300.61 crore (3.34 mt) and from transportation of other goods was `420.85 crore (5.38 mt). 


Chowdhury 95 mlesh Ghode

– –


macro outlook

Macroeconomic indicators of India Steel Insights Bureau

73 71 69 67 65 63 61 59 57 55 53 51 49 47 45 43

79

74

69

YEN

GBP

Source: rbi

11.00%

9.00%

84

USD

Inflation rate in India

10.00%

89

INR vs GBP

INR vs USD, Yen

INR movement against select major currencies

9.78%

10.00%

INR fell in August from 55.48 during the beginning of the month to almost 55.72 towards the end of it versus the USD as data forecast to show that the economy expanded at the slowest pace. Markets are risk averse and are favoring safer assets, making the INR suffer by potential of lower equity flows.

9.87%

9.36%

9.46%

7.74%

8.00% 7.00%

7.56% 7.23%

7.69% 7.23%

7.55% 7.25%

Foreign Exchange Assets

6.87%

1700000

5.00%

305000

1650000

300000

1600000

295000

1550000

290000

1500000

285000

1450000

280000

1400000

Source : OEA, GoI, Ministry of Commerce & Industry

India’s WPI based inflation unexpectedly fell in July to 6.87 percent, its lowest level since January 2010 as domestic petrol and vegetable prices fell in July by nearly 4 percent and 6 percent respectively from that in June. However, rising global oil prices and drought in some parts of India is threatening fresh inflationary pressures. Also, core inflation, which excludes food and fuel prices, rose in July to 5.44 percent while manufacturing inflation rose to 5.58 percent in July, a major factor driving up core inflation. Food inflation eased to just over 10 percent from 10.8 percent.

Wholesale price index (Selected categories) 220 210 200 190 180 170 160 150 140 130 120 110

in million $

310000

in Million $

in Rs crore

6.00%

in Rupees crore

Source: rbi

India’s foreign exchange reserves rose by $1.26 billion to $290.18 billion in the week ended August 24. Total reserves slipped by $250.5 million to $288.92 billion in the previous reporting week. Foreign exchange reserves rose by $ 17.8 million to $ 289.17 billion for the week ended August 10.

Index of Industrial Production 205 185 165 145 ALL COMMODITIES MANUFACTURED PRODUCTS Basic Metals Alloys & Metal Products

PRIMARY ARTICLES FUEL & POWER Steel

Source : OEA, GoI, Ministry of Commerce & Industry

India’s wholesale price index (WPI) (Base 2004-05=100) rose by almost 6.87 percent to164.8 in July as compared to 154.2 recorded in the corresponding month of 2011. Also WPI for May this year was revised to 163.9 this month. The index for primary articles group increased by 10.39 percent to 218.8 from 198.2 in July the previous year. The index for manufactured products group also rose by 5.58 percent to 145.7 from 138 in July 2011. Fuel and power index rose 5.98 percent to 175.5 from last year while index for basic metals and metal alloys rose by 9.62 percent to 166.4 on rising prices of the product globally. Steel index however remained unchanged.

64 Steel Insights, September 2012

125 105 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Mining & Quarrying Electricity

Manufacturing General Index

Source : Govt. of India, MoSPI

India’s index of industrial output fell for the third time in four months in June as Industrial output shrank 1.8 percent to 124.3 in June, dragged down by a deep dip in manufacturing. Manufacturing, shrank an annual 3.2 percent from a year earlier with the sector getting knocked down by shrinking exports to recession-hit Europe and slowing US economy.


market report

Global crude steel production up 1.68% in July Chandrika Mitra

W

Overall, Asian markets, in comparison to January-July 2011 recorded a 0.55 percent increase in production of crude steel as the region closed the January-July 2012 period with crude steel production of 892.7 mt. In the EU, Germany produced 3.6 mt of crude steel in July 2012, a decrease of 2.1 percent on July 2011. Spain’s crude steel production for July 2012 was 1.0 mt, 7.0 percent higher than July 2011. In July 2012, the UK produced 0.9 mt of crude steel, up by 6.6 percent compared to July 2011.

orld crude steel production for the 62 countries reporting to the World Steel Association (Worldsteel) was 129.7 million tons (mt) in July 2012, up 1.68 percent as compared to 127.596 mt in June 2012. However, crude steel production for July 2012 was lower by just 0.13 Crude steel production growth rate (Y-o-Y) percent compared to July 2011. 30.00% In July 2012, Asia produced 85.3 mt of crude steel, an 25.00% increase of 3.8 percent over July 2011. The EU produced 14.227 20.00% mt of crude steel in July 2012, down by 4.93 percent compared 15.00% to the same month of 2011. North America’s crude steel 10.00% production in July 2012 was 10.235 mt, 1.41 percent higher than 5.00% the corresponding month of 2011. 0.00% China, the single largest producer, produced 61.693 mt -5.00% of crude steel in July this year, an increase of 4.04 percent as -10.00% compared to the corresponding period in 2011, when production stood at 59.3 mt. However m-o-m production saw a rise of 2.46 percent as compared to June’s produce of 60.213 mt. China Rest of the world except China World Elsewhere in Asia, Japan produced 9.259 mt of crude steel in July 2012, an increase of 1.16 percent compared to the same EU’s total production between Januarymonth last year. India’s production for July 2012 stood at 6.59 mt, up 6.98 percent compared to July 2011. South Korea produced 5.911 mt during the same period, a 4.43 percent increase July this year stood at 103.23 mt, a decrease of 4.55 percent as compared to January-July on the same month 2011. 2011. However, compared to June 2012, World crude steel production (in ‘000 tons) production dropped by 3.52 percent. Turkey’s crude steel production for July Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 2012 was 3.1 mt, an increase of 9.7 percent European Union (27) 14,157 15,763 14,945 15,352 14,746 14,227 compared to July 2011. In July 2012, Russia Other Europe 2,907 3,342 3,090 3,282 3,146 3,261 produced 5.9 mt of crude steel, an increase of C.I.S. (6) 9,064 9,365 9,000 9,305 9,235 9,515 3.6 percent compared to the same month last North America 10,209 10,860 10,727 10,639 9,959 10,235 year. The US produced 7.4 mt of crude steel South America 3,790 4,211 4,130 3,990 3,852 4,010 in July 2012, up by 0.9 percent on July 2011. Brazil’s crude steel production for July 2012 Africa 1,202 1,299 1,256 1,282 1,235 1,285 was 3.0 mt, 4.1 percent lower than July 2011. Middle East 1,661 1,625 1,736 1,795 1,598 1,404 The crude steel capacity utilisation ratio Africa/Middle East 2,863 2,924 2,992 3,077 2,833 2,689 for the 62 countries in July 2012 declined to China 55,883 61,581 60,575 61,234 60,213 61,693 78.7 percent from 80.4 percent in June 2012. India 5,700 6,200 6,000 6,200 6,375 6,590 Compared to July 2011, it is 0.8 percentage Japan 8,612 9,324 9,077 9,228 9,198 9,259 points lower. It is to be noted that the March to July South Korea 5,438 6,095 5,909 5,973 5,764 5,911 2012 data covers 62 countries against 64 in Taiwan, China 1,718 1,859 1,783 1,840 1,790 1,850 March to June 2011. In January and February Asia 77,351 85,059 83,343 84,475 83,339 85,302 2012, only 59 countries are covered as three Oceania 454 459 480 473 485 500 African countries, Algeria, Libya & Morocco Rest of the world except China 64,912 70,402 68,132 69,359 67,383 68,046 while two Middle East countries Iran and Qatar did not provide monthly production World 120,795 131,983 128,707 130,593 127,596 129,739 statistics. 

66 Steel Insights, September 2012


Market Report

Domestic flat & long markets

Low domestic demand keeps prices down

few weeks though market traders report that sellers are reluctant to sell at lower prices, other than current levels amid low production. Manufacturers are unwilling to sell at lower levels and current offers for Billet stand at `30,800 per ton (Ex-works Raipur). However, heavy rainfalls in Northern and Western India have disturbed construction activities leading to poor demand in long steel products. Heavy rains have also hampered construction activity in Maharashtra, leading to fall in prices of long products in the last few weeks. Rebar prices too have started to correct by `200-300 per ton in the last few weeks owing to heavy rains. Traders feel that there is lack of infrastructural development by the government and no major reform in policies have taken place. They are not willing to hope for the markets to pick up in the coming few weeks under these circumstances. Price trend as observed in the auction held at metaljunction for flat products

Following graphs show the price trend observed in the auction services of Metal Junction for the months of July & August 2012 for different HR and CR products. Outlook

Anondo Kumar Dutta

T

he domestic hot rolled coil market participants are holding a largely pessimistic short-term outlook. This downturn has been mainly attributed to sluggish domestic demand being aggravated by steadily declining import offer prices. Transaction levels in the HRC market for 3mm thick and above, structural HRC presently average `35,000-35,500 per ton exworks. Export prices of 3mm thick and above commercial grade HRC is currently prevailing at $555-560 per ton CFR. Liquidity issues, poor sentiments and weak demand continue to weigh on the domestic market. The expected arrival of imported cargo in coming months could further pressure domestic prices. To boost demand, primary producers are increasing the quantity discount on flat

68 Steel Insights, September 2012

products in the range of `700-1000 per ton. However, buyers are still cautious and are willing to wait for a few more days to receive more clarity about the market. Long product market

Billet prices have dropped in the last

The flat steel market has seen a stagnant trend for the last couple of months. Though it is unaffected by seasonal adversities, it is suffering from drop in demand from the white goods sector. Whereas hot-rolled products have dropped by 1-2 percent over a month, cold-rolled products have dropped by 1-4 percent over a month. Mixed trends have been exhibited by the flat steel products.

Percent change for hot-rolled flat products (m-m, q-q, y-y basis) July â&#x20AC;&#x2122;12 Price (Avg.)

Aug â&#x20AC;&#x2122;12 Price (Avg.)

% change (M-M)

% change (Qtr-Qtr)

% change (Yr-Yr)

Cobble Plate

31361

32043

2.17

3.17

9.83

Def. Plate

28036

28565

1.89

-5.67

3.74

Def. HR Plate

28549

28767

0.76

-6.50

5.93

Semi Rolled Plate

29941

30251

1.04

-1.01

10.93

Def. HR Sheet

31100

31459

1.15

-4.09

4.72

Products


Market Report Percent change for cold-rolled flat products (m-m, q-q, y-y basis) Products

July ’12 Price (Avg.)

Aug ’12 Price (Avg.)

% change (M-M)

% change (Qtr-Qtr)

% change (Yr-Yr)

Def. CR Coil

34150

33101

-3.07

-6.94

-1.30

Def. CRNO Sheet

34723

34138

-1.69

-1.42

9.85

CR Coil End SPM-I

33994

32945

-3.08

-2.21

9.20

CR Sheet Cutting

28518

27812

-2.48

-11.14

5.99

--

33060

--

--

9.65

CR Coil End SPM-II

Percent change for long products (m-m, q-q, y-y basis) Products

July ’12 Price (Avg.)

Aug ’12 Price (Avg.)

% change (M-M)

% change (Qtr-Qtr)

% change (Yr-Yr)

Defective Billet

30574

30035

-1.76

-7.42

2.87

Plate Cutting

29215

30397

0.93

-5.36

3.71

MM End Cutting

26909

30881

5.70

-3.46

9.99

Rejected Bloom

30116

26853

-0.21

-7.48

0.16

A sinusoidal weekly movement has been a common phenomenon. In light of such a scenario, the trends seem unpredictable. With the automobile sector and other white goods sector showing a slowdown in

Wtd. Avg. Prcie (Rs./MT)

Wtd. Avg. Price(Rs./MT)

HR products price trend

34000

Long products price trend 35000

32000

30000

33000 31000 29000 27000 25000

28000

Defective Billet Rejected Bloom

26000

MM end Cutting Plate Cutting

Price in `/t is basic Defective HR Plate-Rourkela Cobble Plate Def. Chequered Plate

Semi Rolled Plate Defective HR Plate-Bokaro

Defective Plate HR Sheet

demand, a sudden rise in demand is not expected in the coming few weeks.

Price in `/t is basic

37000

Price trend as observed in the auction held at metaljunction for long products

CR products price trend

Following graph shows the price trend observed in the auction services of Metal Junction for the months of July & August 2012 for different long products.

Wtd. Avg. Price (Rs./MT)

35000 33000

Outlook

31000 29000 27000 25000

CR Coil End from SPM - I Defective CRNO Sheet

Defective CR Coil CR Sheet Cutting

UACE from HDGL

Price in `/t is basic

70 Steel Insights, September 2012

The long product market has remained almost stagnant except in the last week of August when buyers are trying to place orders just before the rainy season. However, heavy rains have halted construction activities across various regions of the country. Buyers are already accepting materials which are rusted due to the incessant rains. This has prompted them to take the upper hand during price negotiations. With the monsoons casting a gloomy outlook in the coming few weeks, a drop in demand is imminent for construction grade long steel products. 


Market Report

Domestic raw materials market

Scrap prices keep rising on low supplies Anondo Kumar Dutta 38000

he weekly containerised shredded scrap import prices have increased by $8 per ton or 2 percent from previous

Price (Rs./t)

levels. Prices have risen by $12 per ton than four weeks ago. However, no new bookings have been reported as monsoons have set in across various regions of the country, which traditionally signifies a slowdown in production of finished steel. Even the shipbreaking sector for scrap steel, has suffered huge losses (to the tune of `8,000 crore) due to exchange rate fluctuations. In such a scenario, when local producers are shutting mills to protest exorbitant power rates and rupee continues to remain weak as

Wtd. Avg. Price(Rs./MT)

T

34000

30000

26000

22000

CR Coil End WRM Material

Side-End Shearings Turning & Boring

Price in ` per ton is basic

compared to dollar, supplies for scrap remains restricted across the country. However, as demand remains subdued, the market seems unaffected by changes Ingot, melting scrap trend in steel scrap prices.

37000 36000 35000 34000 33000 32000 31000 30000 29000 28000 27000

Ingot at Ghaziabad Ingot at Mumbai

Ingot at Raipur M.Scrap at Mandi

Ingot at Mandi

Source: NCDEX

Pig iron

Outlook

Pig Iron is being traded at current levels across the country but market participants expect some correction in prices. Looking at the current steel market, the large manufacturers of pig iron are anticipated to quote low price for September.

The secondary scrap steel market has seen mixed trends in the month of August. Though some products have seen a marginal rise in prices of about 1 percent, majority of products have seen a slight drop in prices, some to the tune of 9-10 percent. Prices are expected to drop but with imports being restricted & local mills reducing their utilization capacities, it wouldn’t surprise market players if prices continue to hold their grounds & see a marginal rise. 

Price trend of ingot, melting scrap

Percent change (m-m, q-q, y-y basis)

Ingot at Mandi

Ingot at Ghaziabad

Ingot at Raipur

Ingot at Mumbai

Melting Scrap at Mandi

Jul'12 Week 1

34282

33464

31582

31364

29282

Jul'12 Week 2

34481

33286

31273

31132

29481

Jul'12 Week 3

34146

33005

31009

31246

29146

Jul'12 Week 4

32950

32264

30773

31141

27950

Aug'12 Week 1

33214

31983

30277

31346

28214

Aug'12 Week 2

33564

31667

29955

31478

28564

Aug'12 Week 3

34133

32372

29861

32011

Aug'12 Week 4

34033

32745

30033

Aug'12 Week 5

33882

32582

30273

All prices quoted above are average price in `/t, basic

72 Steel Insights, September 2012

Demand is quite low and monsoons have impacted sales. It is difficult to find buyers in good numbers at current levels. Hence, producers are looking to cut prices soon. Shortage of foundry grade material in Raipur has resulted in price rise by `300 per ton to `29,800 per CR Gas Cut Coil End Cutting ton. Indian sponge prices likely to be range bound in short term. Markets are likely to play in same range on factors like short supply of power in Andhra and Tamil Nadu, expensive power in Punjab, Maharashtra and Bengal and ample supply of pellet sponge in central and eastern India.

Scrap products price trend

Products

July’12 Aug’12 % change Price (Avg.) Price (Avg.) (M-M)

% change (Qtr-Qtr)

% change (Yr-Yr)

CR Coil End

31849

32140

0.92

-0.92

0.10

WRM Material

28950

28516

-1.50

-10.40

4.57

Side-End Shearing

29203

28208

-3.41

-7.56

5.03

29133

Pipe Cutting

26645

--

--

--

--

32594

29033

CR Gas Cut

30182

27400

-9.22

-11.27

0.96

31932

28882

Coil End Cutting

27743

27209

-1.92

-10.65

-0.24


PRODUCTION DATA

Production, Imports, Exports, Availability & Apparent Consumption (provisional) April - July 2012 Steel Insights Bureau (in â&#x20AC;&#x2DC;000 tons)

FINISHED STEEL PRODUCERS

Non-Alloy Steel (Carbon) 2012 - 13 (Prov.)

2011 - 12 (Prov.)

Alloy Steel

% Variation

SAIL

3212

3073

4.5

RINL

851

829

TSL

1915

(a) Prod. of Main Producers

2012 - 13 (Prov.)

2011 - 12 (Prov.)

% Variation

% Variation 4.1

2.7

851

829

2.7

1784

7.3

1915

1784

7.3

5978

5686

5.1

6062

5778

4.9

ESSAR

1925

2212

-13.0

1925

2212

-13.0

JSW ISPAT

1157

1027

12.7

1157

1027

12.7

JSWL

3543

2701

31.2

3805

2987

27.4

JSPL

411

391

5.1

411

391

5.1

7036

6331

11.1

262

286

-8.4

7298

6617

10.3

13469

13801

-2.4

1229

1182

4.0

14698

14983

-1.9

Less : IPT/Own Consumption

2765

3051

145

112

2910

3163

(c) Total Production for Sale

23718

22767

4.2

1430

1448

-1.2

25148

24215

3.9

(d) Imports $

2229

1428

56.1

655

454

44.3

2884

1882

53.2

(e) Exports $

1341

1497

-10.4

139

182

-23.6

1480

1679

-11.9

24606

22698

8.4

1946

1720

13.1

26552

24418

8.7

57

-257

18

1

-39

-256

24663

22955

1928

1719

26591

24674

1901

1722

310

335

2211

2057

22762

21233

1618

1384

24380

22617

Others

(e) Availability (c+d-e) (f) Variation in Stock (g) Apparent Consumption (e-f) Less : Double Counting Real Consumption

7.4

7.2

Source: Steel Ministry

For Classified Advertisements contact

Sumit Jalan, +91 91633 48243 or sumit.jalan@mjunction.in

74 Steel Insights, September 2012

262

92

286

-8.7

2011 - 12 (Prov.) 3165

84

92

2012 - 13 (Prov.) 3296

(b) Prod. of Major Producers $

84

Total

-8.7

-8.4

12.2

16.9

7.8

7.8


price trend

Ferro alloys & metals price trends Steel Insights Bureau Ferro alloys & Metals

August'12

July'12

June '12

Ex-works Rs/ ton HC Ferro Chrome (Cr - 60%) 69000

64500

73000

Ex-works Rs/ ton HC Ferro Manganese (Mn - 70%) 53500

54000

55000

Ex-works Rs/ ton Silico Manganese (Mn - 60%, Si - 14%) 58650

54000

56000

Ex-works Rs/ ton MC Ferro Manganese ( Mn - 70%, C -1.5) 77000

77000

79500

Ex-works Rs/ ton LC Ferro Manganese (Mn - 70%, C - 0.1) 112000

112500

112500

Ex-works Rs/ kg Ferro Vanadium 790

830

830

CIF in US$/lb of moly Moly Oxide (Mo - 57% min) 11.25

13.25

13.75

Ex-works Rs/ ton Ferro Titanium (Ti - 30%) 152500

162500

152500

Ex-works Rs/ ton CPC (FC - 98%, S - 1.2%, size 0-10mm) 24500

25500

25500

Steel Insights, September 2012

75


export data

Iron ore export data for July 2012 Steel Insights Bureau

PORT

DESTINATION COUNTRY

DATE

2-Jul-12

PRODUCT FE CATEGORY CONTENT

UNIT PRICE (in Rs/ton)

QUANTITY (in tons)

54

3,889

7,400

58/57

5,251

7,683

FINES

54 6-Jul-12

FINES

10-Jul-12 FINES

56

55.5 53

KOLKATA

CHINA

11-Jul-12 FINES

3,611

11,793

4,111

4,972

CHINA

9,457

2,666

54

3,675

14,000

55

3,333

2,500 1,480

20-Jul-12 FINES

55

4,356

8,000

21-Jul-12 FINES

63.5

6,613

2,000

26-Jul-12 FINES

52

1,892

22,000

27-Jul-12 FINES

63.5

6,763

20,000

28-Jul-12 FINES

52

1,892

3,000 149,774

11-Jul-12 FINES

12-Jul-12 FINES 12-Jul-12 FINES

76 Steel Insights, September 2012

UNIT PRICE (in Rs/ton)

QUANTITY (in tons)

4,062

5,000

4,183

290

4,575

7,000

5,619

5,500

4,475

5,000

2,916

36,200

PARADIP Total

8,625

24,000

10-Jul-12 FINES

17-Jul-12 FINES

3,600

KOLKATA Total

PARADIP

CHINA

27-Jul-12 FINES

6,722

FINES

PARADIP

835

2,838

9-Jul-12

13-Jul-12 FINES

2,029

53

FINES

PRODUCT FE CATEGORY CONTENT

4,111

63.5

6-Jul-12

DATE

3,600

16-Jul-12 FINES

FINES

DESTINATION COUNTRY

18-Jul-12 FINES

19-Jul-12 FINES

5-Jul-12

PORT

292,880 10-Jul-12 FINES

54

4,777

3,934

63.5

6,777

143,796

11-Jul-12 FINES

57

12-Jul-12 FINES

62 51

24-Jul-12 FINES

57 63.5

CHINA VIZAG 25-Jul-12 FINES

55

4,702

1,323

4,833

33,082

6,270

18

6,444

73,784

3,333

24,186

4,888

78,886

4,986

9,435

6,608

83,260

4,648

4,600

4,702

8,889

6,608

902

3,500

50,000

6,403

31,186

6,093

23,894

6,178

20,000

6,178

17,000

3,405

3,400

4,082

12,000

6,032

50,000

4,038

1,800

4,183

5,610

VIZAG Total

688,712

4,575

19,000

Grand Total

1,131,365

63.5 28-Jul-12 FINES

63.5

6,752

67,620

30-Jul-12 FINES

56

4,324

14,400

3,826

90

54

3,829

35,100

55

4,054

43,194

63.5

6,752

287

FINES

65

7,730

35,308

LUMPS

65

8,398

31-Jul-12 FINES

JAPAN

9-Jul-12

26,618


Tear along the dotted line

Steel Insights, September 2012

77

Tear along the dotted line


78 Steel Insights, September 2012



Steel Insights - Sep 2012