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Tata Steel commissions India’s largest blast furnace at Kalinganagar

The new furnace is part of Tata Steel’s strategy to meet increasing demand for steel

Published

2 weeks ago

September 23, 2024

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Tata Steel has officially commissioned India’s largest blast furnace at its Kalinganagar plant. This significant development is expected to boost the company’s production capacity and enhance operational efficiency. The new furnace is a key part of Tata Steel’s strategy to meet increasing demand for steel in the domestic market.

The state-of-the-art facility features advanced technology aimed at reducing emissions and improving sustainability. This move aligns with Tata Steel’s commitment to environmentally responsible production practices while maintaining competitiveness in the industry.

With this commissioning, Tata Steel is well-positioned to strengthen its leadership in the Indian steel sector and cater to the growing needs of various industries.

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Nomura: Indian steel majors among best-positioned producers worldwide

The report highlights a compound annual growth rate (CAGR) of 4.8%

Published

2 hours ago

October 4, 2024

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India’s steel industry is set to expand significantly over the next few years, with plans to add around 23 million tonnes (MT) of crude steel capacity between FY24 and FY27, according to a report by Nomura.

As per the report, the industry is reflecting a compound annual growth rate (CAGR) of 4.8 per cent. The report noted that this growth target is in consistent with the industry’s long-term average growth from FY15 to FY24.

Despite this substantial increase in capacity, experts believe that the Indian steel sector is poised to enter a favorable phase.

“We estimate India’s steel industry will add approx. 23MT crude steel capacity over FY24-27F, at an implied 4.8 pc CAGR, in line with the FY15-24 long-term average” said the report.

The report noted that the steel majors JSW, JSPL, Tata Steel and ArcelorMittal & Nippon Steel should account for nearly 87 per cent of the ongoing capacity expansion. Although the report noted that significant capacity will come onstream over the next three years.

The JSW steel is set to add 7MT by FY28F at a 5 per cent CAGR over FY24-28F, according to the report. While the JSPL is set to add 6.3MT by FY27F at an 18 per cent CAGR over FY24- 27F.

The report also suggested that even under a conservative assumption of 6 per cent CAGR in steel demand through FY27 (compared to 7 per cent over the last five years), capacity additions are still expected to fall behind demand growth during this period. This could lead to an improvement in the domestic supply-demand balance, reducing the need for steel companies to rely on exports for volume growth.

“Improvement in domestic supply-demand fundamentals through FY27F would suggest reduced dependence on exports for volume growth” added the report.

India’s steel companies are well-positioned within the global metals sector, according to analysts. These companies benefit from operating at the lower end of the global cost curve, mainly due to lower labor costs. Additionally, India’s iron ore costs remain competitive compared to other countries, even for non-integrated steel producers.

The future expansion of India’s steel industry is expected to be driven largely by brownfield projects, where existing facilities are expanded or upgraded. Strong domestic demand is another factor that could help reduce the industry’s reliance on exports.

Over the past few years, India’s steel production has grown at a 6 per cent CAGR between 2019 and 2023, far outpacing China’s 1 per cent growth and the rest of the world’s 1 per cent decline. With these factors in place, Indian steel companies are seen as some of the best-positioned producers globally, offering significant growth potential in the coming years.

“We believe Indian steel majors are among the best-placed producers globally” the report noted.

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BSL to establish two greenfield steel units

Phase I will boost production through brownfield development with the current facility.

Published

2 hours ago

October 4, 2024

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Bokaro Steel Plant (BSL) has announced plans to set up two Greenfield steel units, each with a production capacity of 5 million tonnes per annum (MTPA). However, the immediate focus is on a brownfield project aimed at increasing BSL’s existing crude steel production capacity from 4.66 MTPA to 7.61 MTPA by 2030.

According to BSL Director-in-Charge Birendra Kumar Tiwari, the first phase of expansion will concentrate on boosting production through brownfield development within the current facility.

“Although we have the potential to establish two Greenfield projects with 5 MTPA capacity each, our current priority is on the brownfield phase. We plan to invest in Greenfield projects after generating sufficient revenue from the brownfield expansion. Over the next five years, BSL will prioritise production growth and use the resulting profits to fund future Greenfield ventures,” Tiwari stated.
(ET)

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Indian steel majors among best-positioned globally: Nomura

The companies will contribute nearly 87% of the ongoing capacity expansion.

Published

2 hours ago

October 4, 2024

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India’s steel industry is poised for substantial growth, with plans to add approximately 23 million tonnes (MT) of crude steel capacity between FY24 and FY27, according to a report by Nomura. The sector is projected to grow at a compound annual growth rate (CAGR) of 4.8%, aligning with the industry’s long-term growth trend from FY15 to FY24.

The report highlights that major steel producers such as JSW, JSPL, Tata Steel, and ArcelorMittal & Nippon Steel will contribute nearly 87% of the ongoing capacity expansion. Specifically, JSW Steel is expected to add 7MT by FY28 at a 5% CAGR, while JSPL is set to add 6.3MT by FY27 at an impressive 18% CAGR.

Despite this significant increase in capacity, the report suggests that supply additions may still fall short of demand growth. Even under a conservative estimate of 6% CAGR in steel demand through FY27 (compared to 7% in the last five years), the domestic supply-demand balance is expected to improve, potentially reducing the need for Indian steel companies to rely on exports for volume growth.

Analysts believe that Indian steel majors are well-positioned in the global metals sector due to their competitive cost structure. Lower labour costs and competitive iron ore prices, even for non-integrated producers; place them at the lower end of the global cost curve.

The future expansion of India’s steel industry is expected to be driven primarily by brownfield projects, with strong domestic demand further supporting growth and reducing the industry’s dependency on exports.

(ET)