THE INDIAN INSTITUTE OF METALS - DELHI CHAPTER
NISSUE NO.EW 88/2015 S VOL. LXXXVIIIL E“MONTHLY” T T DATE:E 31.05.2015R K L Mehrotra - Chairman, Delhi Chapter | S C Suri - Editor-in-Chief (IIM-DC Newsletter) THE INDIAN INSTITUTE OF METALS - DELHI CHAPTER In The Issue NEWS LETTER Indian Steel Industry – Current Status, ISSUE NO. 94/2015 VOL. XCIV “MONTHLY” DATE: 30.11.2015 Opportunities and Challenges K L Mehrotra - Chairman, Delhi Chapter | S C Suri - Editor-in-Chief (IIM-DC Newsletter) Metals Demand Heading for North Coal India set to embrace PPP model for difficult mines Steel Minister Narendra Singh Tomar asks SAIL to check falling market share JSW Steel is now largest steel maker in India SteelIn imports The hitIssue record high, surge 71% in Fy15 SAIL spends seven times more on employees for • producingTechnology a tonne Profile of steel of Indian than new Steel plants Industry Condolences(in continuation for Metallurgy of write-up Legend in – Shriprevious A C Wadhawan IndicatorsNewsletter) point by to Shrigood S days C Suri, ahead Hon. for Member Indian steel industry’ • SteelCarbon industry Footprint needs increase by Shri in demand,K L Mehrotra, not dutyChairman, protection IIM Delhi Chapter Stainless Steel Production Reaches 41.7 Million • MetricA brief Tons reportin 2014 on technical talk on Sub Steellance traders Technology urges govt. for to dropBOF newShop quality & High control order Govt.Productivity to Bring 18 Blast Steel FurnacesProducts under Quality Control Order • Outokumpu’sGlobal Coal stainless Consumption steel fuel tank heads wins ISSF for Newbiggest Applications decline Award in History OUTOKUMPU CEO MIKA SEITOVIRTA ELECTED THE THE INDIAN INSTITUTE OF METALS - DELHI CHAPTER • CHAIRMANIndia’s prospects OF ISSF relatively robust to grow Stateat 7.2% power OECD firms to import 52 MT coal in Fy16 Rising Chinese Imports Remain a Concern for Steel Firms • LowChina Global to Prices be theto Encourage most critical Iron Orefactor Import for Unusedmetal Mobile prices Phones are Squandering Gold Worth £100 Million • PlansSteel on cheapto raise imports,share in auto Chinese segment supply glut Moilhammer Slashes prices Manganese Ore Prices by up to 25% Metallic Insight • WinningMany Startsnational With & Beginnings international news items Show Preview 11th International Exhibition & Conference R MINERALS METALS METALLURGY MATERIALS w w w . m m m m - e x p o . c o m 10 - 12 AUGUST. 2016 Published By PRAGATI MAIDAN, NEW DELHI, INDIA The Indian Institute of Metals – Delhi Chapter Jawahar Dhatu Bhawan, 39, Tughlakabad Institutional Area Published By M B Road, Near Batra Hospital, New Delhi-110062 International Conference on The Indian Institute of Metals – Delhi Chapter Tel:Jawahar 011-29956738, Dhatu Bhawan, Telefax: 39, 011-29955084 Tughlakabad Institutional Area “MINERALS & METALS AND THEIR E-mail:[email protected];M B Road, Near Batra Website: Hospital, iim-delhi.com New Delhi-110 062 CONTRIBUTION TO MAKE IN INDIA” Tel: 011-29956738, Telefax: 011-29955084 Organised by: IIM-Delhi Chapter E-mail:For Private [email protected]; Circulation only Website: iim-delhi.com
ISSUEISSUE NO. NO.94/2015 89 VOL.VOL. LXXXIXXCIV “MONTHLY” THE INDIAN DATE INSTITUTE 30.11.2015 OF METALS 30-06-2015
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Dear Fellow Members, Chairman K L Mehrotra India has vast storehouse of knowledge in variousOFFICE fields but BEARERS OF DELHI CHAPTER OF IIM Vice Chairman general awareness of much of it is inadequate. We allChairman’s live in a knowledge society, only those people who areChairman’s able to V C Singhal V K Tyagi convert knowledge into Skilled Action become its realMessageChairmanPresident asset. O P Gupta In this respect, our Hon’ble Prime Minister has aptly coined a Hon. Secretary statement MSDC “Make in India, SkillDear India, Fellow Digital Members, IndiaK L Mehrotra and Deepak Vaidya Gautam Bhatia Chairman K L Mehrotra Clean India”. Thus a knowledge conomyIndia requireshas vast developing storehouse of knowledgeHon. Jt. inSecretary various fields but Vice Chairman D. Kashiva its workers as Knowledge Technologistsgeneral who awareness are flexible of with much of it is inadequate.G I S Chauhan We all live in a Vice Chairman analytical skills and act as a growth engines for an innovative Dr. Vipin Jain V C Singhal knowledge society,V C Singhal only those people who are Ashokable toKumar Rana and knowledge driven society. convert knowledge into Skilled ActionN Vijayan become its real asset. V K Tyagi We the members of IIM DC, a professionalIn this respect, body, ensureourV K Hon’ble Tyagi our Prime MinisterHon. Treasurer has aptly coinedAdvisory a CommitteeHon. Secretary strong commitment to the highestatementst standa MSDCrd of “Makevalues ,in India, SkillM P India,Sharma Digital India and Deepak Vaidya behavior, integrity and welfare oCleanf Met India”als, M.i nThuseHon.ra als knowledgeSecretaryand conomyHon. Jt. requires Treasurer developingB R Thukral Hon. Jt. Secretary Material Science Sectors. its workers as Knowledge TechnologistsD Kashiva who are flexible with G I S Chauhan We are always committed to excellenceanalytical in spirit skills and andManoranjan action. act as a Ram growthMembers engines for an innovativeB D Jethra Dr. Vipin Jain We believe everything we do and andeverything knowledge we think driven can society. S C Suri N Vijayan Hon. Jt. Secretary Raj Tiwari always get better, which drives ourWe quest the members for Excellence. of IIM DC, a professionalR K Gupta body, ensure our Hon. Treasurer Lastly, whatever the strength of stthroen ign dcivoidmumalistm, wenet wtoill the highAe Cst Rs tDasandard of values, M P Sharma accomplish together. We put the team aheadG I oSf Chauhanour P K Chatterjee Invitees behavior, integrity and welfare of Metals, Minerals and Hon. Jt. Treasurer personal success and connect to building its capability. The Manoranjan Ram Material ScienceDr. Sectors. Vipin Jain K.K. Mehrotra D Kashiva Delhi Chapter collective trust each other to deliver our Gajendra Panwar We are always committed to excellence in spirit and action. Members respective obligations. We believe everything we do andO everything P Gupta we think can N Vijayan Gautam Bhatia Dr. A.K. Kapoor S C Suri We at IIM DC is ONE TEAM - Together alwaysEveryone get Achieves better, Mwhichore drives our quest for Excellence. R K Gupta I personally believe in three things: Alignment, Clarity and Rahul Khanna Lastly, whateveHon.r th eTreasurer strength ofAshok the Kumarindivid Ranauals, Dr.we Arvind will Bharti A C R Das Trust. So we must ACT. accomplish together. We put the team ahead of our P K Chatterjee Advisory Committee I would like to thank all my colleaguespersonal for theirsuccess unflinchingM andP Sharma connect to building its capability.Technical The & PublicationManoranjan Cell Ram B R Thukral dedication, commitment and contribution to strengthening Gajendra Panwar Delhi Chapter collective trust eachB D Jethra other to deliver our our Delhi Chapter. I am looking forward to continueHon. on Jt. our Treasurer A C R Das O P Gupta respective obligations. Raj Tiwari mission of creating sustained vaWelue at f oIIMr DCour ise ONEstee TEAMmed - Together Everyone Achieves More Gautam Bhatia Rahul Khanna K K Mehrotra members. I personally believe in three things:Technical Alignment, & Publication Clarity andCell Rahul Khanna A C R Das Ashok Kumar Rana I would like to place on record my sincereTrust. Soappreciation we must ACT. to the Members K K Mehrotra G I S Chauhan immediate past Chairman and I Ewouldxecu tilikeve toC othankmmit tallee my colleagues for their unflinching Advisory Committee members for their guidance and continuing faith in me. G I S Chauhan B R Thukral dedication, commitmentS C Suri and contributionManoranjan to RamstrengtheningManoranjan Ram our Delhi Chapter. I am looking forward to continue on our B D Jethra Dr. Vipin Jain Raj Tiwari With Best Regards, mission of creRa tKin Guptag sustained vGajendraalue for Panwarour estDr.ee Vipinmed Jain members. Gautam Bhatia Technical & Publication Cell I would like to placeA C R on Das record my sincereDr. Arvind appreciation Bharti Gajendra to the Panwar A C R Das immediate past Chairman and Executive Committee K K Mehrotra members for theirP Kguidance Chatterjee and continuing faith in me.Gautam Bhatia G I S Chauhan Manoranjan Ram Deepak Vaidya Dr. Arvind Bharti Dr. Vipin Jain K L Mehrotra With Best Regards, Chairman Gajendra Panwar Gajendra Panwar Gautam Bhatia Dr. Arvind Bharti
K L Mehrotra Chairman NEWS LETTER ISSUE NO. 88/2015 VOL. LXXXVIII “MONTHLY”
InTechnologydian Steel ProfileIndustr ofy -Indian Curre nSteelt St aIndustrytus Opportuniti(Ines Continuation and Chal ofl epreviousnges edition) Older hot rolling mills however, are still Shri S C SuriHon. Member IIM & The engineering and equipment sector contributes ShriEditor-in-Chief, S C Suri IIM DC Newsletter handicappedaround 23 percent with obsolete of steel consumption.rolling technology The recent Hon. Member IIM & andlack practices of orders resulting in the capital in poor goods productivity, sector and the Editor-in-Chief, IIM DC Newsletter poorpo dimensionalor demand tolerancefor the candons uhighermer d energyurable s has consumption.impeded the The growth level of of steel technology demand inin the these country. Rolling Mills & Processing Lines 1. For the last three years the performance of Indian mills has to be changed through modernization HotSteel Rolling Industry Mills does not present a bright picture. and renovation. During the current year, the capital goods sector has grown by 5.7 percent and the The Indian Steel Industry is facing a number of Re-rolling mills in small and medium plants Several state-of-the-art hot rolling mills have been consumer durable sector has come down by challenges. An analysis of these challenges is contributing over 20 million tonnes of finished set up by the steel plants, and others are in the 14.2 percent. Correspondingly, it is also seen processnecessary. of acquisition of such mills. JSW Steel has steel production conventionally suffer with poor productivity that andimports energy of engineering inefficiency alsogoods causing containing 2.recently Challenges commissioned and Opportunities one of the for mostthe Steel modern Sector high CO2 steel emission. has been On going the initiative up in the of last Ministry few years. of This andThe the following widest hotissues strip are mill facing (2.2 m the wide) steel in sector: India. implies that Indian manufacturing is losing its Bhushan Power & Steel and Essar Steel have set up Steel, in association with UNDP, a specific energy Subdued demand efficiency sheen improvement to the import project of cheaper has been manufacturing taken modern hot strip mill adopting CSP route recently. goods from China and other countries. Tata- GrowthSteel is inin theSteel advanced consumption stage has of been setting low up due up under which over 20 mills have been upgraded a second to fall hot in infrastructure strip mill adopting investment. CSP technology. and several In the more 2015-16 units budget are in it implementationhas been stated Essar DuringSteel has April also – February’15 set up the thewidest real (5mconsumption wide) stage. Therethat totalis an subsidiesurgent need given to byupgrade the the and ofone steel of thehas mostnosedived sophisticated to 0.6 percent and state-of- over technological Government face of amounting this important to Rs. sector 3.76 lakhin the-art corresponding plate mill capable period ofof lastproducing year. all high order tocrores increase in food, their fertilizer,productivity diesel, and LPG energy gas, efficiency through eco-friendly technologies. qualityThe recent plates estimatesincluding haveAPI, Q&T shown and that normalized investments etc. need to be reformulated so that the platesworth hitherto of Rs. 8.8imported lakh crores from (7abroad. percent The of trend GDP) is in Cold RollingBPL populationMills for whom the subsidies is continuingvarious projects and in theare nextstalled few primarily years, many due to more Like HRMs,needed CRM getsector its shareis also ingetting full. There a facelift is an state-of-the-artenvironment rollingand forest mills areclearance. expected The in highthe flat urgent need to do away with and long product segment. SAIL (RSP) is already with setting up of modern, state-of-the-art mills debt/equity rate in the steel sector is another issue. intermediates mopping up the fund from setting up a wide (4.3m) plate mill with all modern with best productivity and quality. Till the end It is, however, gratifying to note that rate of features. In the long product segment, also, the of 90’s, themost Government. of the cold rollers The moneywith single thus stand saved increase in stalled projects has subsequently come scenario is changing. Modern bar and rod mills reversing could mills bewere fruitfully handicapped invested towith make limited up the down in the recent period. A number of stalled have been set up by JSW, JSPL, Tata Steel and capacity, massive poor yield infrastructure and also deficitpoor quality of the due projects have been cleared by the Committee others which are capable of rolling products with to processcountry. limitations. However, the scenario earmarked for the purpose The budget for 2015-16 tight dimensional tolerances. SAIL is also setting has since changed substantially with setting up has envisaged the following increased outlays and The Government is keen to facilitate the up a universal Rail Mill at Bhilai Steel Plant. of several large capacity state-of-the-art rolling Gross mills. ToPP improve agreement the overall with major yield risksand beingreduce Some plants are also practicing latest techniques the scrap,borne PLTCM by (picklingthe Government line and tandem in order cold to Budgetarylike Hot Charging support for of infrastructure Slabs (though sector: partially) rolling mill)attract has been private installed. investment Seeing that the successhas been in - hot Roads: rolling (+) Rs.areas 14031 and cr. reaping benefits in of PLTCM languishing at Tata Steel for and the Essar, last manyfew years. other steel terms- Railways: of productivity (+) Rs. 10050 and cr.energy conservation. producers such as Bhushan Steel are following The revision in the PPP model would Schedule-free- Ultra Mega: 5rolling, nos. Projects high (>4000pressure MW) de- suit. Tata Steel is planning to set up a wider PLTCM scalers, AWC (Automatic Width Control), Use facilitate private participation in The Government is envisaging Rs. 70,000 croreat Kalinganagar. JSW Steel and UTTAM Steel have of HSS Rolls, Hydraulically controlled AGC for developing railway lines in particular additional investment for infrastructure for 2015-16established Twin Stand Reversing mill in recent gauge accuracy, finishing stands with level-2 compared to previous year (including the fundtimes. stretches, enhance their share in ports and automation, Roll Cross Pair, Edge preheaters, earmarked for Industrial Corridors and Smart Cities). communication substantially. The Ultra-Fast Cooling in ROT and edge masking To improveconstruction the gauge of consistencynew ports (87 and major shape, ports This would lead to higher demand for steel particularlywork roll bending, CVC crown, intermediate roll system are other developments to improve and many medium ports are due for the long products and plates. shifting, Feedback & Feed Forward Gauge Control, the productivity, quality and rolling efficiency. expansion) is stated to commence in a big The announcement by the Government to build 2Hydraulically operated AGC, sophisticated X-Ray Improvement in heating efficiency and reduction way. crorein fuel houses consumption in urban in areas reheating and 4 crorefurnace houses can forbe rural gauges and Level-2 automation system have areasachieved by 2022 by willinstallation provide ofa boostHEC (Highof steel Efficiency demand forbeen introduced. Most of the above have been theCombustion) real estate regenerative segment. burner, which also has adopted by the Steel producers, who supply Steel favourable effect on CO2 emission. for the high-end application. xxxxx 000 xxxxx
4 4 5 Carbon Footprint
K L Mehrotra Ex- Chairman & Managing Director ISSUE NO. 94/2015Manganese VOL. XCIVOre “MONTHLY” India Ltd, Date: Nagpur 30.11.2015 NEWS LETTER & Chairman, IIM Delhi Chapter E-mail: [email protected] How ClimateCarbon Change Footprint Affects the Universe? Gangas is from rivers in Nepal which means that if Himalayan glaciers dry up so will the K L Mehrotra Ganga downstream in India. ClimateEx- Chairman change & Managing is now Director with us. A Manganese Ore India Ltd, decadeNagpur ago, & Chairman, it IIMwas Delhi Chapterconjecture, todayChairman’sE-mail: it is [email protected] reality and the future is Message unfolding before our eyes. How Climate Change Affects the Universe? Dear Fellow Members, Chairman K L Mehrotra • IndiaClimate has vast storehouse change of knowledgeis now with in various us. fieldsA decade but general Global awareness of muchwarming of it is inadequate. could We all live cause in a moreVice Chairman knowledgeago, itsociety, was onlyconjecture, those people todaywho are itable is toreality V C Singhal hunger in Afro-Asian countries V andK Tyagi convertand knowledge the future into Skilled is unfolding Action become before its real our asset. eyes. In this respect,could our Hon’ble melt Prime most Minister hasof aptly the coined Himalayana Hon. Secretary statementGlaci MSDC “Makeers byin India, 2030 Skill India, – accordingDigital India and to Deepaka UN Vaidya • CleanGlobal India”. Thus warming a knowledge could conomy cause requires more developing hunger Hon. Jt. Secretary its workersin Report.Afro-Asian as Knowledge Technologistscountries whoand are flexiblecould with melt G I S Chauhan analytical skills and act as a growth engines for an innovative Dr. Vipin Jain andmost knowledge of driventhe Himalayan society. Glaciers by 2030 – N Vijayan We accordingthe Hundredsmembers of toIIM DC,a ofUN a professional millionsReport. body, of ensure people our wouldHon. Treasurer strong cbeomm iaffected.tment to the hig hTheest st areportndard of v aalsolues, predictsM P Sharma • behHundredsavior, integrity ofan dmillions welfare ooff M epeopletals, Mine rawouldls and be Hon. Jt. Treasurer Material Science Sectors. affected.more Theheat report waves also inpredicts countries more Dsuch Kashiva We are always committed to excellence in spirit and action. Members We heatbelieveas waves everythingUS and in we countries doEU and countries, everything such we as think USCanada canand EU S etc.C Suri always get better, which drives our quest for Excellence. R K Gupta Lastcountries,ly, w hatever thCanadae strength oetc.f the individuals, we will A C R Das acco mpIfli shthe toget hecurrentr. We put t heglobal team ahe awarmingd of our Prates K Chatterjee • personalIf the success current and connect global to building warming its capability. rates The are Manoranjan Ram are maintained, Himalayan GlacierGajendras Panwar Delhimaintained, Chapter collective Himalayan trust each other Glaciers to deliver ourcould respectivecould obligations. decay at very rapid Orates P Gupta We atdecay IIM DC is ONEat TEAMvery - T ogetherrapid E veryonerates Ashrinkingchieves More from Gautam Bhatia I personallyshrinking believe in three from things: the Alignment, present Clarity and 500000 Rahul Sq. Khanna Ashok Kumar Rana Trust.the So we present must ACT. 500000 Sq. Kms. To 100000 Sq. I wouldKms. Kms.like By to thank2020. To all 100000 my colleagues Sq. for Kms.their unflinching By 2020. Advisory Committee dedication, commitment and contribution to strengthening B R Thukral our Delhi Chapter. I am looking forward to continue on our B D Jethra • This would reduce water supplies for Raj Tiwari missio n Thisof cre awouldting susta inreduceed value for owaterur esteem esuppliesd for farming and lead to severe drought Technical & Publication Cell members.farming and lead to severe drought I wouldsituation. like to place on record my sincere appreciation to the A C R Das immedisituation.ate past Chairm an and Executive Committee K K Mehrotra members for their guidance and continuing faith in me. G I S Chauhan • Temperatures are set to rise by 2~3oC Manoranjan Ram Dr. Vipino Jain Withbetween Best Temperatures Regards, 2004-2030 causing are set displacement to rise by 2~3GajendraC Panwar of over 350 million people due to floods. Gautam Bhatia between 2004-2030 causing displacementDr. Arvind• BhartiThus by of 2020, over over 350 1.2 million billion people in • Malarialdue toinfection floods. would affect over 400 Asia will experience increased water million people due to flood. Extinction of stress and over 2.0 billion by 2030. The per K L Mehrotra Chairman25-30% Malarial of all theinfection land species. would About affect 265 over 400capita million availability people in India due would to drop flood. from millionExtinction people wereof 25 affected-30% of by all natural the land species.1900M3 toAbout 1000 M3 265 by 2025.million people calamities during 2000-2004, out of these were affected by natural calamities • duringCereal 2000 yield- 2004,in Asia outcould of drop these upto 98% 30% 98% were in developing nations. were in developing nations. by 2050 causing hunger.
• Himalayan Glaciers called the “Water • Even modest rise in sea level will cause Tower Himalayan of Asia” has Glaciers a glacier coveragecalled the of “Waterflooding Tower and of Asia”economic has disruptionsa glacier in 5,00,00coverage Sq. Kms. of 5,00,00 Sq. Kms. densely populated areas. 4 • It provides 8.6 billion M3 of water. About • Cholera/Malaria could increase, thanks 70% of the world’s fresh water is frozen to flooding and wider habitat range for
in glaciers. Himalayan Glaciers are the mosquitoes. largest store of water outside the polar ice caps and feed seven great Asian rivers viz. • Some 30% Asian coral reef which sustain Indus, Brahmaputra, Mekong, Salween, a large percentage of marine life are Yargtze, Huang Ho and hundreds of small expected to be lost in next 30 years due to rivers. Nearly 70% of the discharge into climate changes.
4 4 5 NEWS LETTER ISSUE NO. 94/2015 VOL. XCIV “MONTHLY” Date: 30.11.2015
• Green House Gases (GHG) – A Major American emits 23 T of CO2, a British emits Culprit. 11.0 T and a Chinese, 3.1 T, Brazil – 4.1 T/ S. Country CO2 Emission Growth CO2 Emission year, Japan 10.6 T/year, Germany 12.3 T, No (In Million 1990-2004 Per Capita (T) France 8.6 TPY and Russia 13.4 TPY. Tonnes) % 1 US 6046 25 20.6 • In India, the population who earns more 2 China 5007 109 3.80 than Rs. 50,000/- per month emits 5.0 TPY, 3 Russia 1524 -23 10.6 between Rs. 25,000 – Rs. 50,000/- - 3.1 TPY 4 India 1324 97 1.2 and below Rs. 5,000/- per month is 1.0 TPY. 5 Japan 1257 17 9.9 6 Germany 808 -18 9.8 • If the fridge is placed away from heat / 7 Canada 639 54 20.0 Sun, 150 Kg of CO2 / year can be reduced 8 UK 587 1 9.8 more so ever, energy efficient and CFC 9 Korea 465 93 9.7 free fridge is very essential to use. 10 Italy 450 15 7.8 World 28,983 28 4.5 • While shopping, usage of reusable bag rather than plastic / PP bags can prevent • The environmentalists say that the fastest 8 Kg per year of CO2 emission. growing contributor to global warming is aviation sector. • While brushing the teeth, if the habit of keeping the water tap open throughout, • In 2006, all around the world, people took is stopped 3 Kgs. CO2 / year emission can more than two billion journeys on schedule be reduced. airlines, which is higher by 4% over 2005. As per ICAO, IATA predicts 50 billion journeys • 55% of world carbon emission is produced would be performed by 2016. by 15% of population in US, Canada, EU countries etc. • As the airplane travels at high altitude, the impact on global warming is more. The • There are three basic things which one average plane releases close to one tonne can make a beginning. of CO2 for each passenger, it covers from 1. Reduction in usage of the planet, London to New York or Delhi to London. The which we inhabit logic being that since the emission of CO2 in huge amount and at such high altitude 2. Reusing of the items we use in daily will have a direct impact on CHG effect life leading to increase in global warming. 3. Recycling of items, which may • Flight are something that people should try produce certain by-products, viz to avoid for short distances or unless there paper recycling, aluminium can is an emergency. recycling, PET recycling and metal scrap recycling. • The authorities instead of promoting aviation in a big way should focus on • If one would like to see the size of his / developing other modes of transports like her Carbon Foot Print in other words, how road and electric trains/metro which are much tonnage of CO2 emitted through much cleaner and more environmental their life style every month / year. Let’s friendly. make a beginning. • Every activity we do generates a certain • Reduce electricity consumption and amount of Green House Gases (GHG), switch to CFL bulbs / LED lights in houses which can be measured in units of CO2 / offices in place of incandescent bulbs / and that is what Carbon Credit is all about. tube lights. This helps to save ½ a ton of CO2 in a year. 10,000 MW power/per year • In India, average Indian emits 1.3 tonnes would be saved if energy efficient CFL/LED of CO2 and with increasing lifestyle it may were used to light up homes in India. go up to 1.8 tonnes CO2/year. While an
6 7 NEWS LETTER ISSUE NO. 94/2015 VOL. XCIV “MONTHLY” Date: 30.11.2015
• Reduce a Petrol/Diesel by using fuel from a developing country that doesn’t efficient car with higher mileage say 16 face a cap. Kms/Ltr., which would emit 40 T of CO2 in • India / China are the sellers under CDM its lifetime say 10 years (4 T CO2/year). We (Clean Development mechanism) may also use Biodiesel / bio fuel, admixture protocol. CDM allows company projects to reduce CO2 emissions. 660 Kg of carbon in developing countries to trade in CERs emission can be reduced if fuel is improved with countries that have a cap. One CER in car/bus engines etc. is equivalent to a reduction of one tonne • Do not print out, unless need arises and be of CO2. conservative in use of paper, 24 grown up • Clean money for dirty air, that’s the promise trees are required to be cut to produce 1 of an emerging trade in Carbon Credit. ton of paper, which has a direct impact on absorbing CO2. One big tree absorbs • The value of Carbon Trading was around 20 Kgs. Of CO2 / year. US 30 billion in 2006 as per the estimate of International Emission Trading Association. • Reduce Air journey. Do it only in if it is unavoidable. Aircraft emits 12.5 Kg of • The CER is sold at a price negotiated CO2 / per person/100 Kms. all journey at between buyer and seller. Currently, Indian high altitude. Thus a return journey Delhi/ sellers are able to realize 6-8 Euros on an Mumbai or Delhi/Kolkata emits 0.33 T of average per CER. CO2 per person. • Hence, the CER is offered with guarantee • As well said, for any climate change entire of delivery by the regulator. Since its humanity is involved and all of us are launch, in April, 2005, the EU’s contract has concerned. The GHG / CO2 emission can been close to 1.3 billion tonne CO2 (CER) be attributed in two ways. Direct emission traded with a market value of 24 billion of CO2 is due to usage of car / scooter, Euros. heavy vehicles, air planes etc. Indirect • Therefore carbon credits bought by a CO2 emissions is like electricity through Company are a tradable permit that coal fired thermal plant, which we use, provides a way to reduce GHG emissions cooking gas, water supply, eating habits, by giving them a monetary value. A credit shopping, etc. gives the owner the right to emit one ton CARBON TRADING: Money from CLEAN AIR of CO2. What’s Carbon Trading? • Typically companies that invest in windmill, bio-diesel, co-generation, solar power etc., • The idea of a trade in Certified Emission are the ones that can generate Carbon Reduction of CO2 (CER) took place Credits for selling to the developed nations. after signing of KYOTO PROTOCOL of UN Framework Convention of Climate • Barely a day goes by without talk of Change (UNFCC). climate change, the scientific report have shown, it is happening and that human • It mandates GHG emission caps on activity is responsible. If we are to move industrialized developed nations which beyond talk, we need urgent solutions. have ratified it but also allows then to buy The renewable energy, carbon capture greener nations GHG emission level, which and bio-fuels are among the main source means a CER can be earned by reducing to mitigate climate change. emissions through eco-friendly projects. xxxx 000 xxxx Thus a developed nation can buy a CER
6 7 BRIEF REPORT ON TECHNICAL PRESENTATIONS ON SUB LANCE TECHNOLOGY FOR BOF SHOP AND HIGH PRODUCTIVITY BLAST FURNACES
The Delhi Chapter organised a technical presentation on the followingNEWS two topics LETTER at our premisesISSUE NO. 94/2015 VOL. XCIV “MONTHLY” Date: 30.11.2015 on 21st December 2015: BRIEF REPORT ON TECHNICAL PRESENTATIONS ON a) SUBSubBRIEF LANCE lance REPORT Tec TECHNOLOGYONhnology TECHNICAL for PRESENTATIONS BOF FOR BOF ON SUBSHOP LANCE AND TECHNOLOGY HIGH PRODUCTIVITYShop andFOR BOF SHOP BLAST AND HIGHFURNACES PRODUCTIVITY BLAST FURNACES
TheThe DelhiBRIEF Delhi REPORTChapter Chapter ONorganised TECHNICAL organised a technical PRESENTATIONS a hit rates, ONreduction SUB LANCE in consumption TECHNOLOGY of fluxes, b) presentationHightechnical on FORtheProductivitypresentation following BOF SHOP two ANDtopicson HIGH atBlast ourthe PRODUCTIVITY optimal utilisation BLAST of scrap, FURNACES energy savings and premises on 21st December 2015: improvement in the refractory linings life and Furnacesfollowing two topics at our premises improvement on safety and environmental fronts. a) st Sub lance Technology for BOF Shop onThe 21 Delhi andDecember Chapter 2015: organised a technical presentation on the At the outsetb) High Shri Productivity SC Suri, Blast Furnacesimmediate past Chairman, Delhi Chapter, spoke followinga) Sub two lance topics Tec hnologyat our premises for BOF aboutAt the outsetactivitiesst Shri SC of Suri, Delhi immediate Chapter. past Chairman,on 21 Shop DecemberDelhi andChapter, 2015: spoke about the activities of Delhi Chapter. ThereafterThereafterb)a) KKHighSub LL Mehrotra, lance Mehrotra,Productivity Tec Chairman,hnology Chairman, welcomed for BlastBOF welcomedthe participants FurnacesShopthe in and theparticipants programme. He ingave the an introductory remarks about the speakers of M/s prograDanielmme. Corus who were toHe make thegave presentations an Atb) theHigh outset ShriProductivity SC Suri, immediate Blast past Chairman, Delhi Chapter, spoke introductoryon the above tworemarks topics. Thereafter, about the dais thewas handedabout over Furnacesthe to theactivities speakers of for Delhi presentation. Chapter. speakers of M/s Daniel Corus who The presentation on (a) above was given by Shri wereSubrat toAtThereafter Mishrathemake outset and theK on L (b)Shri Mehrotra,presentations above SC Suri,was given Chairman,immediate by Shrion past Chairman, Delhi Chapter, spoke the Manishaboveaboutwelcomed Wadhwa thetwo activities ofthe M/stopics. Danielparticipants of Corus DelhiThereafter, India Chapter. inPvt Ltdthe located at New Delhi. the dais progra wasmme. handed He over gave to thean Shri introductoryThereafterMishra, in his presentation,K L remarksMehrotra, touched about Chairman, upon thethe speakerssuccessful for implementation presentation. of a sublance based BOFspeakerswelcomed process control of theM/s system participantsDaniel in India. Corus He inspoke whothe aboutwereprogra the advantagestomme. make theof installation Hepresentations gave of sublance anon The system.presentationtheintroductory Designabove and twoon remarksautomation (a)topics. above about Thereafter,aspects was theof given by Shri Subrat Mishra and on (b) sublance technology were also discussed. Use aboveof thespeakerscalcium was dais givencarbide wasof M/s byhandedand DanielShri magnesium Manish overCorus toin whoWadhwathethe of M/s Daniel Corus India Pvt Ltd locateddesulphurisationspeakerswere at Newto makefor of Delhi.presentation.hot metalthe presentations was also discussed. on The theadvantages above twoof sub topics. lance Thereafter,technology resultsThethe in presentationdaisreduction was in handedtap on to tap(a) overtime,above increaseto wasthe given by Shri Subrat Mishra and on (b) in LD productivity by around 20%, increased Shri Mishra,speakersabove was forin given presentation.his bypresentation, Shri Manish Wadhwa of M/s Daniel Corus India Pvt Ltd Shri Manish Wadhwa spoke abouttouched located upon at New Delhi.the successful the installation of high volume blastimplementation The presentation of on a(a) abovesublance was given by Shri Subrat Mishra and on (b) furnaces installed by Daniel Corusbased at Shriabove BOF Mishra,process was given in control byhis Shripresentation, systemManish Wadhwain of M/s Daniel Corus India Pvt Ltd SAIL and other steel plants. The useIndia. touchedlocatedHe at spoke Newupon Delhi. theabout successful the of higher volume blast furnaces implementation of a sublance advantages of installation of results in higher production of hot basedShri Mishra, BOF process in his control presentation, system in metal. He also spoke about thesublance India.touched system. He uponspoke Designthe aboutsuccessful andthe Shri Manish Wadhwa spoke about the installation 4506 Meter cube blast furnaceautomation advantagesimplementation aspects of ofof installation a sublancesublance of of high volume blast furnaces installed by Daniel Corus at SAIL and other steel plants. The use of being erected by them at thetechnology sublancebased wereBOF processsystem. also discussed. controlDesign system Useand in proposed steel plant of NMDC ofat calcium automationIndia. carbideHe aspectsspoke and magnesiumofabout sublance the in the desulphurisation of hot metal was technologyadvantages were of alsoinstallation discussed. Useof Nagarnar, Chhatisgarh, on turnkeyalso discussed. The advantages of sub8 lance technology results in reduction 9 basis. He informed that this will be ofsublance calcium carbidesystem. andDesign magnesium and in the desulphurisation of hot metal was in tap alsoautomationto tapdiscussed. time, aspects Theincrease advantages of insublance LD of productivity sub lance technology by around results 20%, in reduction increased hit India’s largest furnace to date.rates, It reduction in consumption of fluxes, optimal utilisation of scrap, energy was also indicated by him that JSW intechnology tap to tap were time, also increase discussed. in LD Use productivity by around 20%, increased hit is planning to instal a blast furnacesavings rates,of andcalcium reduction improvement carbide in consumption and magnesiumin the ofrefractory fluxe in thes, optimal desulphurisation linings utilisation life and ofof hot scrapim metalprovement, energy was on of 5000 meter cube capacitysafety alsosavingsand discussed. environmental and improvement The advantages fronts. in the of refractory sub lance linings technology life and results improvement in reduction on wherein Daniel Corus will play a insafety tap andto tap environmental time, increase fronts. in LD productivity by around 20%, increased hit 9 major role in installation of the same. rates, reduction in consumption of fluxes, optimal utilisation of scrap, energy9 He also stated that raw material savings and improvement in the refractory linings life and improvement on stipulation for larger blast furnaces safety and environmental fronts. are more critical than the smaller 9 blast furnaces. So the raw material burden for the higher blast furnaces has to meet the critical requirements
After conclusion of the presentations, there was lively question and answer session. About 30 persons participated in the programme.
Shri G I S Chauhan, Hony Jt. Secretary, gave vote of thanks.
At the end the speakers were given away mementoes by Chairman on behalf of the Chapter.
The programme concluded with lunch. xxxx ooo xxxx
Global Coal Consumption Heads for Biggest Decline in History
Coal consumption is poised for its biggest decline in history, driven by China’s battle against pollution, economic reforms and its efforts to promote 10
Shri Manish Wadhwa spoke about
the installation of high volume blast Shri Manish Wadhwa spoke about furnaces installed by Daniel Corus at the installation of high volume blast SAIL and other steel plants. The use furnaces installed by Daniel Corus at of higher volume blast furnaces SAIL and other steel plants. The use results in higher production of hot of higher volume blast furnaces metal. He also spoke about the results in higher production of hot 4506 Meter cube blast furnace metal. He also spoke about the being erected by them at the 4506 Meter cube blast furnace proposed steel plant of NMDC at being erected by them at the NEWSproposedNagarnar, steelLETTERChhatisgarh, plant of onNMDC turnkey ISSUEat NO. 94/2015 VOL. XCIV “MONTHLY” Date: 30.11.2015 basis. He informed that this will be Nagarnar, Chhatisgarh, on turnkey higherIndia’s volume largest blast furnacesfurnace results to indate. higher It basis. He informed that this will be productionwas also of hot indicated metal. He alsoby spokehim thatabout JSW the 4506India’s Meter cubelargest blast furnacefurnace being to date.erected It is planning to instal a blast furnace by themwas atalso the indicated proposed steel by planthim thatof NMDC JSW at Nagarnar,of 5000 Chhatisgarh, meter oncube turnkey capacity basis. He is planning to instal a blast furnace informedwherein that thisDaniel will be CorusIndia’s largestwill playfurnace a to date.of It5000 was alsometer indicated cube by him thatcapacity JSW is major role in installation of the same. planningwherein to instal Daniel a blast Corusfurnace ofwill 5000 play meter a cubeHe capacity also statedwherein thatDaniel rawCorus materialwill play major role in installation of the same. a majorstipulation role in installation for larger of theblast same. furnaces He also statedHe thatalso raw stated material that stipulation raw formaterial larger are more critical than the smaller blaststipulation furnaces are for more larger critical blast than thefurnaces smaller blastblast furnaces. furnaces. So the rawSo thematerial raw burden material for are more critical than the smaller the burdenhigher blast for furnaces the higher has to blastmeet thefurnaces critical requirementsblast furnaces. So the raw material has to meet the critical burden for the higher blast furnaces Afterrequirements conclusion of the presentations, there was livelyhas question to and meetanswer session.the Aboutcritical 30
personsrequirements participated in the programme. After conclusion of the Shri G I S Chauhan, Hony Jt. Secretary, gave vote of thanks.presentations, there was lively After conclusion of the question and answer session. About At presentations,the end the speakers there were wasgiven awaylively mementoes30 persons by Chairman participat on behalfed inof thethe question and answer session. About Chapter.programme. 30 persons participated in the The programme concluded with lunch. and energy campaigner. The decline in coal use programme.xxxx ooo xxxx will help reduce greenhouse-gas emissions that Shri G I S Chauhan, Hony Jt. Secretary, gave vote of thanks. are blamed for heating up the planet. To limit the Global Coal Consumption Heads for Biggest rise in global temperatures to 2 degrees Celsius DeclineShri inG History I S Chauhan, Hony Jt. Secretary, gave vote of thanks. At the end the speakers were given(3.6 away degrees mementoes Fahrenheit) --by the Chairman level scientists on Coal consumption is poised for its biggest decline say cannot be exceeded if the world is to avoid behalf of the Chapter. in history,At the driven end bythe China’sspeakers battle were against given catastrophic away mementoes climate change by --Chairman emissions from on pollution, economic reforms and its efforts to coal must fall 4 percent annually through 2040, behalf of the Chapter. promoteThe programmerenewable energy. concluded Global use with of thelunch. Greenpeace said. most polluting fuel fell 2.3 percent to 4.6 percent in xxxx oooChina xxxx Declining the Thefirst nine programme months of 2015 concluded from the same with period lunch. last year, according to a report released recently In China, responsible for about half of global coal
xxxx ooodemand, xxxx use in the power sector fell more than by the environmental group Greenpeace. That’s a decline of as much as 180 million tons of 4 percent in the first three quarters and imports Global Coal Consumption Heads for Biggest Decline in History standard coal, 40 million tons more than Japan declined 31 percent, according to the report. usedGlobal in the same Coal period. Consumption The report confirms Heads that Since for Biggestthe end of Decline 2013, the country’sin Histo electricityry Coal consumption is poised for its biggest decline in history, driven by China’s worldwide efforts to fight global warming are consumption growth has largely been covered by havingbattle a significant against impact pollution, on the coal economic industry, newreforms renewable and energy its plants.efforts “The to coal promote industry Coal consumption is poised for its biggest decline in history, driven by China’s the biggest source of carbon emissions. It comes likes to point to China adding a new coal-fired10 a daybattle before against the International pollution, Energy economicAgency is powerreforms plant andevery weekits efforts as evidence to promotethat coal scheduled to release its annual forecast detailing demand will pick up in the future, but the reality10 the ways the planet generates and uses electricity. on the ground is rather different,” according to “These trends show that the so-called global coal the report. “Capacity utilization of the plants has boom in the first decade of the 21st century was a been plummeting. China is now adding one idle mirage,” said Lauri Mylyvirta, Greenpeace’s coal coal-fired power plant per week.”
8 9 India's prospects relatively robust; to grow at 7.2%: OECD
With 'relatively robust" growth prospects, the Indian economy is expected to expand by 7.2 per cent this fiscal but difficulty in passing key structural reforms and large non-performing loans are holding it back, says Paris-based think tank OECD. However, the Organisation for Economic Cooperation and Development (OECD) cut the global growth forecast for this year to 2.9 per cent citing a "further sharp downturn in emerging market economies and world trade". The latest growth estimate for India is same as the forecast made in September by the think tank.
In the current financial year (ending March 2016), India is estimated to grow 7.2 per cent, followed by 7.3 per cent in 2016-17 and 7.4 per cent in 2017-18 NEWS LETTERperiod, as per OECD.ISSUE "Brazil NO. and 94/2015 Russia haveVOL. experienced XCIV “MONTHLY” recessions Date: 30.11.2015 and will not return to positive growth in annual terms until 2017. "By contrast, growth prospects in India U.S. Electricity remain relatively robust, The share of coal used towith generate GDP electricitygrowth in the U.S. will fall to 36 percentexpected this yearto fromremain 50 percent a decade ago. Moreover than 7 per 200 cent coal-fired in the power plants, with total capacitycoming of years, 83 gigawatts, provided have been scheduled forfurther retirement, progress including is made 13 gigawatts expected toin retire this implementingyear. Coal consumption in the Europeanstructural Union reforms," was flat inthe the first nine months, after thinkdeclining tank a recordsaid in6.5 a percent in 2014, accordingstatement. to Greenpeace. Economic In India, domestic coal productiongrowth has ofbeen India on the is rise, with sales by Coal Indiaprojected increasing to7 percentremain inrobust, In itsat latest around Economic 7.25 per Outlook cent over report, the OECD projection said the first nine months, and consumptionperiod, it added. increasing that in India public investment has picked up about 5 percent. India’s efforts to promote with faster clearance of key projects while better renewable energy is also eatingIn its intolatest demand Economic for Outlookinfrastructure report, and OECD greater said ease that of indoing India business public coal, and stockpiles in the countryinvestment have has increased picked up arewith promoting faster clearance private investments.of key projects More while generous better sharply. “Coal is in terminalinfrastructure decline, and and those greater benefits ease of and doing wages business for publicare promoting employees private are countries investing in coal investments.for export markets More generousare supporting benefits privateand wages consumption. for public “Even employees so, large are making reckless decisions,”supporting Myllyvirta said. private consumption.non-performing "Even so, largeloans, nonhigh-performing leverage loans,ratios highfor leverage ratios for some companiessome companies and difficulty and difficulty in passing in keypassing structural key Source: http://www.bloomberg.com reforms are holding the structuraleconomy reformsback. The are current holding account the economy deficit is India’s prospects relativelywidening robust; asto machinerygrow at importsback. increThe currentase, but account is largely deficit financed is widening by rising 7.2%: OECD foreign direct investment inflows,"as machinery the report imports said. increase, but is largely financed by rising foreign direct investment With ‘relatively robust” growth prospects, the inflows,” the report said. Indian economy is expectedIndia's to economicexpand by growth 7.2 slowed to 7 per cent in the three months ended per cent this fiscal but difficultyJune compared in passing to key7.5 perIndia’s cent expansioneconomic recordedgrowth slowed in the Januaryto 7 per-March cent structural reforms and largequarter, non-performing as per offic loansial estimates.in the threeWhile monthscutting theended world June economic compared growth to are holding it back, says estimateParis-based to think2.9 per tank cent 7.5 for per this cent year, expansion OECD hasrecorded projected in the a January- gradual OECD. However, the Organisationstrengthening for Economic of global growthMarch in 2016quarter, and as 2017 per to official 3.3 per estimates.cent and 3.6While per Cooperation and Developmentcent, respectively.(OECD) cut the"But acutting clear thepick world-up ineconomic activity growthrequires estimate a smooth to global growth forecast for this year to 2.9 per 2.9 per cent for this year, OECD has projected12 cent citing a “further sharp downturn in emerging a gradual strengthening of global growth in market economies and world trade”. The latest 2016 and 2017 to 3.3 per cent and 3.6 per cent, growth estimate for India is same as the forecast respectively. “But a clear pick-up in activity made in September by the think tank. requires a smooth rebalancing of activity in China and more robust investment in advanced In the current financial year (ending March economies,” it added. As per OECD’s September 2016), India is estimated to grow 7.2 per cent, estimates, global growth was to be 3 per cent this followed by 7.3 per cent in 2016-17 and 7.4 per year and 3.6 per cent in 2016. cent in 2017-18 period, as per OECD. “Brazil and Russia have experienced recessions and The think tank said China’s growth is expected will not return to positive growth in annual terms to slow to 6.8 per cent this year and continue to until 2017. “By contrast, growth prospects in decline gradually reaching 6.2 per cent by 2017 India remain relatively robust, with GDP growth as activity rebalances towards consumption expected to remain over 7 per cent in the and services. About India, OECD said that fiscal coming years, provided further progress is made policy is assumed to remain supportive. Public in implementing structural reforms,” the think tank investment in the energy, transport, sanitation, said in a statement. Economic growth of India housing and social protection sectors is critical is projected to remain robust, at around 7.25 per to raising living standards for all and can be cent over the projection period, it added. financed through tax reform and reductions in
10 11 NEWS LETTER ISSUE NO. 94/2015 VOL. XCIV “MONTHLY” Date: 30.11.2015
subsidies, it added. “The remaining slack in the for the metals prices. Emkay expect iron ore economy and the disinflation process will provide and aluminium prices to remain weak demand room for some monetary easing by the end of scenario. Steel prices might stabilize provided there the projection period.” Creating more and better is faster production cuts. Though, global prices will jobs will require further improving the ease of have their impacts, domestic prices are likely to be doing business, modernising labour regulations, driven primarily by the underlying demand going implementing the goods and services tax and forward, for which proper implementation and making land transactions easier,” the report execution of projects are must. noted. Further, OECD said that rapid economic Emkay Global analyst expects volatility in the growth, better household access to energy and metals prices which will continue pending the more manufacturing activity would raise energy rate decision by the US Fed. Also, China issues consumption, which is now highly subsidised should be watched closely in this regard, which and carbon intensive. “Despite recent hikes in should guide the price direction going forward. coal, petrol and diesel duties, average effective Reserve Bank of India, on 29th September, 2015 tax rates on CO2 emissions remain relatively cut the benchmark repo rate by 50 basis points to low. Phasing out subsidies for kerosene and gas 6.75%. This is likely to boost the sentiments by way and raising electricity prices would help contain of lower interest cost and attracting investments emissions. Such measures risk hurting the poor, in medium to long term. however, and so will need to be accompanied by compensating measures,” it added. OECD Financial Support Secretary General Angel Gurria said the slowdown Coverage EPS EV/EBITDA P/E Universe in global trade and the continuing weakness in FY16E FY17E FY16E FY17E FY16E FY17E investment are deeply concerning. Coal India 27.1 30.5 7.7 6.2 11.8 10.5 GMDC 8.6 10.6 4.8 3.7 8.5 6.9 In the US, output remains on a solid growth GPIL 2.8 28.4 5.9 3.9 26.0 2.6 Hindalco 7.6 7.5 7.2 7.0 11.1 11.2 trajectory, propelled by household demand, JSW Steel 34.3 121.6 7.4 5.0 26.5 7.5 with GDP expansion expected to be 2.5 per MOIL 23.6 28.0 1.3 0.4 9.0 7.6 cent next year and 2.4 per cent in 2017, the NMDC 10.3 10.4 5.7 6.3 9.7 9.6 SAIL -2.6 2.4 47.5 12.8 -20.8 22.2 think tank said. “The recovery in the euro area Vedanta Ltd. 8.4 15.4 5.7 5.0 11.9 6.5 is set to strengthen, helped by accommodative Tata Steel -2.1 16.1 8.1 6.6 -117.8 15.3 monetary policy, lower oil prices and an easing of Valuation table for Emkay Metals & Mining the pace of budget tightening. Euro area activity universe is expected to grow by 1.8 per cent in 2016 and M. Cap CMP (Rs) as on P/E P/B EV/EBITDA Company 30-Sep- 30- Chg YoY Chg 1.9 per cent in 2017,” the report noted. FY16E FY17E FY16E FY17E FY16E FY17E (Rs bn) 15 Oct-15 (%) (%) Source: The Economic Times Coal India 2,020.6 328 320 (2.4) (11.1) 11.8 10.5 4.4 3.8 7.7 6.2 GMDC 23.3 72 73 2.3 (51.6) 8.5 6.9 0.7 0.6 4.8 3.7 China to be the most critical factor for metals GPIL 2.4 73 74 1.4 (50.7) 26.0 2.6 0.3 0.2 5.9 3.9 Hindalco 173.6 71 84 18.7 (47.6) 11.1 11.2 0.4 0.4 7.2 7.0 prices HZL 664.0 140 157 12.4 (7.0) 8.1 7.7 1.4 1.2 4.0 3.3 JSW Steel 220.1 889 910 2.4 (27.0) 26.5 7.5 1.0 0.9 7.4 5.0 Metals prices across the globe remain weak. MOIL 35.8 197 213 8.0 (30.3) 9.0 7.6 1.0 0.9 1.3 0.4 NMDC 397.5 93 100 7.7 (40.4) 9.7 9.6 1.3 1.2 5.7 6.3 Significant fall was seen in iron ore, steel and SAIL 220.3 51 53 3.9 (36.0) -20.8 22.2 0.5 0.5 47.5 12.8 aluminium prices. Aluminium also has been a Vedanta Ltd. 296.3 85 100 18.0 (60.5) 11.9 6.5 0.5 0.5 5.7 5.0 victim of China’s excess capacity. Recently, Tata Steel 239.5 213 247 16.0 (48.0) -117.8 15.3 0.7 0.7 8.1 6.8 the move by China to cut power tariffs for the Trend: Ferrous Metal second time has postponed planned shutdowns Weak undertone continues in domestic markets by players like Chinalco. As, per Bloomberg too, as global prices continue to fall. Though estimates China should continue to add 3.9 mt safeguard duty of 20% has given some relief, it aluminium capacity, 90% of the total global cannot be considered enough. The industry is capacity addition. asking for further hike in basic custom duty. We Thus, Emkay Global research analyst believes continue to believe that the underlying demand that China is going to be the most critical factor has to pick up for the price stability. Global crude
10 11 NEWS LETTER ISSUE NO. 94/2015 VOL. XCIV “MONTHLY” Date: 30.11.2015 steel production for September’15 stood at 130.9 Industrial Park Special Economic Zone (SEZ) million tonne (-3.7% YoY; -1.1% MoM). Capacity project of Tata Steel in Ganjam district of Odisha utilization rose marginally MoM to 69.3%. was held in October… Trend: Non-ferrous metals The British steel industry is full-scale crisis. Before they were pushed, the Government seemed Prices of most of the base metals stabilized after unwilling to do anything practical about it. In the their sharp corrections in last few months except last 1-2 weeks, 2,200 employees in Redcar have aluminium which fell steeply recently. Aluminium lost their jobs, 3,000 on-site contractors have been prices fell 7.3% during October as its inventory laid off, and 6,000 further jobs will be lost in the level also decreased surprisingly by 4.4%. Other local community… than aluminium prices of rest of the metals rose slightly during the month. A rise of 1.5%, was seen A beaten-down stock coupled with perceived in lead, while marginal rise was noticed in zinc by low appetite among foreign investors could force 1% and copper by 0.8%. Marginal rise in USD index the government to trim the Coal India (CIL) offer by 0.6% in October helped the prices to remain for sale to 5% from 10% planned earlier and push in range and stop the price fall for base metals. the big-ticket disinvestment to the January-March Inventory levels subsequently fell, sharp fall was quarter… seen in copper and lead by 17.3% and 9.7% Source: MMR respectively and slight fall of 2.9% in zinc. Steel Cheap imports, Chinese supply glut Aluminium premiums increased after falling for last 2-3 months as US Midwest aluminium premium hammer prices was up 5.4% at US$ 163/tonne, while, on the other Global steel prices have continued their free hand Japanese aluminium premiums fell by 5.2% fall during the month of October largely due to to come in at 84/tonne MoM. demand weakness and as a result of oversupply of steel in the global market. In addition to this, Major New / Events steel making key ingredient, iron ore prices fell After the success of coal block auctions, the sharply during October 2015 due to continuous government is set to start the bidding process for over supply and demand slowdown in China mines containing major minerals in an attempt leading to production cuts in steel. There would to revive the sector affected by suspension of be further moderation in capacity utilization mining. The process will start shortly with auction especially in China as per the market analyst of around 70 mines. More blocks are to be put report. In April and August this year, the country up for bidding depending on the success of the has imported 3.2 million tonne, a growth of 23% initial round… over the corresponding period last year. In the The government is planning to auction up to 11 month of August alone, imports were to the tune coal blocks in the fourth round of bidding. of 870,000 tonne. Organisations like Niyamgiri Surakshya Samity Such a weaker tone suppresses the domestic (NSS), Lok Sangram Manch (LSM) and All India markets due to sluggish demand, rupee Kisan Mazdoor Sabha (AIKMS) have decided to devaluation, cheaper imports from China, South restart organising people’s movement against Korea and Japan steel exporting steel products alleged attempt of Odisha government to revive to their counterpart in India as per the FTA policy. proposal of bauxite mining in Niyamgiri hill range… As a result, India’s biggest private sector steel manufacturer, JSW Steel had to cut its prices in Aluminium major National Aluminium Company the range of Rs 500-700 per tonne for flat products (Nalco) has moved closer in its bid to bag the and Rs 1,000 per tonne for long products during Pottangi bauxite deposits with Odisha government the month of October 2015. It was the second writing to the Union mines ministry to allocate the price cut in the long products announced by the mines in favour of the central PSU… company recently. Ground-breaking ceremony for the first manufacturing unit to be set up in Gopalpur This reduction in prices comes in the wake of sluggish demand for steel products and cheap
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imports flooding the market. Steel long – especially to the FY11 levels. TMT bars are imported in the guise of alloy bars Amid concerns of demand slowdown in China, from China. The imported products are cheaper steel mills have started curtailing their production by at least Rs 5,000-6,000 per tonne compared too. On the other hand the supply of iron ore from to the domestic prices. The volatility in currency, Australia and Brazil have been robust. These two which has depreciated by 1.6 percent in the factors together have weighed heavily on iron last one month has caused a lot of difficulties ore prices and pulled down prices again below for the steel makers. In line with primary players, US$50/tonne mark. In case of steel, it is sharper secondary steel long spot prices trading at Mandi contraction in demand as against response by Gobindgarh also recorded hefty fall from Rs 26,000 the suppliers. This is resulting into higher availability to Rs 23,700 per tonne during October 2015. of steel in the market, which in turn is putting In order to curb the cheap steel import, the pressure on the price. This is also resulting into government had imposed a 20 percent import higher exports from China and has been the duty on certain products for 200 days from mid- biggest threat for global steel prices. September. The safeguard duty imposed by India a month ago on steel imports has had limited Low grade iron ore in demand impact, except for a price increase of Rs 1,000 Indian iron ore miners resuming exports after a per tonne. Imports have maintained an upward three-year hiatus face a radically altered market, trend and even inventory levels continued to but may find buyers for low-quality ore among loss- remain high. The government had imposed a 20 making Chinese steel mills bent on slashing costs. percent import duty on certain products for 200 Vedanta Ltd, India’s biggest private miner, shipped days from mid-September. its first iron ore cargo of 88,000 tonne to China. Domestic prices could stabilize, if more products So overall, iron ore sank 12 percent in October are brought under safeguard duties. However, from low-cost miners including BHP, Vale and Rio the reverse may be true if the safeguard duty Tinto Group combined with weaker consumption on hot rolled coil flats is allowed to lapse and if in China to spur a glut. The top miners are betting safeguard duties are not extended on products that higher output will enable them to cut unit in the steel value chain. costs and raise market share while less efficient producers get squeezed. Increase in Capacity Utilisation Iron ore extended a slump below $50 a metric As per the recent India Ratings and Research tonne, dropping to the lowest level since July, (Ind-Ra) report the capacity utilisation of Indian as BHP Billiton Ltd. forecast prices will probably steel manufacturers is set to decline as close to extend their decline for years as output rises, 12-14 million tonne of crude steel capacity will while Vale SA reaffirmed plans to increase low- come on board by FYE16 with no significant hike cost supply. in consumption demand. This would put further pressure on large steel products in terms of end- Source: MMR product pricing and EBITDA/tonne. Western steel cos blame China for The Indian steel industry is under stress with the overcapacity crisis credit metrics of steel producers deteriorating substantially from FY11 to FY15. Several leading western steel manufacturers alleged that China is the predominant global Ind-Ra opines that the credit metrics of its rated contributor to the problem of overcapacity that the steel manufacturers would remain stressed in world is currently facing. “The global steel industry the near term, and the improvement in metrics is currently suffering from a crisis of overcapacity to reach the levels of FY11, would require a and the Chinese steel industry is the predominant significant increase in capacity utilisation and global contributor to this problem,” a group of nine profitability. Ind-Ra estimates the EBITDA/tonne US steel industry associations said in a statement. has to increase by 60%-70% by FY17 to allow the “Estimates from the OECD Steel Committee leverage profile of large steel producers to return indicate that there is almost 700 million metric
12 13 NEWS LETTER ISSUE NO. 94/2015 VOL. XCIV “MONTHLY” Date: 30.11.2015 tons of excess steel capacity globally today,” any structural changes which will spur up demand. the statement said. China’s overwhelmingly The winter months have begun and these are state-owned and state-supported steel industry typically high production, high consumption has an overcapacity ranging from 336 to 425 months for the economy. There is hardly any new million metric tons and it is expected to grow in project that has been announced or has got the coming years. “This situation, together with a financial closure. Both integrated steel plants as declining steel consumption, has resulted in record well as DRI-based industry have been under severe levels of steel exports from China to the rest of the financial crisis due to sharp fall in steel prices. world in 2014 and which are on track to exceed The recent introduction of safe guard duty has 100 million metric tons this year,” the statement partially helped steel plants producing HR coils. said. The organisations include American Iron and However, Chinese steel supplier have started Steel Institute, Steel Manufacturers Association, offering CRFH material at prices which are lower Canadian Steel Producers Association, than Indian cold rollers’ cost of production CANACERO (Mexican steel association), Alacero leading to their closure. (Latin American steel association), EUROFER (European steel association,) Instituto AcoBrasil Major importers are now booking cold rolled (full (Brazil Steel Institute), Speciality Steel Industry of hard) coils almost at the same price they were North America, and the Committee on Pipe and shipping in HR coils before the duty was levied. Tube Imports. “China has claimed that it should be Before the duty was levied, hot rolled coils was the automatically accorded treatment as if it were a preferred import consignment. The current trend market economy after the 15th anniversary of its will not only hit large integrated steel producers, accession to the World Trade Organisation (WTO) such as Tata Steel, Essar Steel, and Sail, that in December 2016. We disagree,” the steel makers produce HR coils, but also the stand alone re- said. It is the view of steel producers in Europe and rollers who were producing CR coils. Cold rolled North and South America that China’s Protocol steel is the first value addition to hot rolled coils of Accession to the WTO does not automatically produced by steel companies. require governments to treat imports from China Chinese color coated steel makers are destroying as if they were from a market economy country Indian market. While the Indian domestic price line as of December 2016, they said. Some provisions of various steel items has been impacted severely allow WTO members to treat China as a non- by flood of dirt cheap steel products, Indian color market economy country unless the government coated steel market has been totally destroyed of China or Chinese producers can show that they over past 2 years. The price gap between Indian operate under market economy conditions, the and Chinese PPGI makers is so huge that Indian steel industry said. “Given the continuing significant PPGI offers no competition. role of the Chinese government in many key India’s INR 15,000 crore seamless pipe industry aspects of the Chinese economy, and especially is staring at a spectre of large scale job cuts and in its state-owned and -controlled steel sector, plant shutdowns due to dumping by China at rock there can be no question that China remains very bottom prices in the Indian market as China is facing much a non-market economy today,” they said. anti-dumping and safeguard duties from countries “For the steel sector, recognition or treatment of like the US, the European Union, Canada, Indonesia, China as a market economy at the end of 2016 Brazil and Mexico and is saddled with a large would coincide with the peak of Chinese excess inventory due to subdued demand back home steelmaking capacity, and record level of exports resulting in China’s steel seamless pipe producers to to international markets, including the US, the EU, export products to India at low prices Officials in the and Latin America,” the statement said. steel ministry said they were examining a proposal Source: Metaljunction from the industry to extend safeguard duty on cold-rolled coils (CRC), galvanised products, wire Indian Steel Scenario rods and TOR steel. Taxes, Freight and the Cost of Capital Making Indian Steel Expensive. Although steel demand has been projected to improve fast in the NDA regime, there has not been World Steel Dynamics report has ranked India ahead of most countries, except those from the
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CIS in terms of the cost curve. According to WSD steel information service provider World Steel data for January this year, production cost for hot- Dynamics gave POSCO the top mark of 7.91 rolled coils in India was USD 349 a tonne, compared points out of 10. The WSD report, which ranks the with USD 428 in China, USD 429 in South Korea, USD steelmakers based on 23 categories, gave top 448 in Japan and the global average of USD 418. scores for POSCO in four segments, including For CIS countries, the cost was USD 305 a tonne technologies innovation and human resources. (all figures are ex-works). Add to it the taxes, freight POSCO said the company was highly recognized and the cost of capital, and the picture is not really for its efforts to expand sales of high-end products rosy for domestic steel makers, Indian companies and boost its competitive by carrying out claim. For hot rolled coils, the ex-plat price is about technology-based solution marketing. Rs 27,000 a tonne, while the cost to the consumer, which includes freight and taxes, is Rs 32,000 a U.S.-based minimill Nucor Corp. came next, tonne. Producers in countries such as China are followed by Japan’s Nippon Steel & Sumitomo taking advantage of this huge addition to dump Metal Corp. and Brazil’s Gerdau. Hyundai their produce in the Indian market. Steel Co., an affiliate of the world’s No. 5 auto Mr. Sushim Banerjee, Director General of the conglomerate, Hyundai Motor Group, finished INSDAG said “Our internal freight rate is two-three ninth in the rankings, the second time it has done times higher compared to China. Capital cost, too, so since last year. are high. Most Chinese mills are state owned and avail of loans at one to two percent, compared to Source: Steel Tech a market rate of 4.6 percent. Our market rate, on Steel safeguard duty will hurt: Industry majors the other hand, is 10-12 percent,” It is, therefore, unsurprising that China is selling at $80 a tonne MNCs say the move goes against the spirit of ease below its marginal cost, as it can afford to take a of doing biz, Make in India campaigns. hit. Japan and South Korea, on other hand, are Multi-national companies with interest in India selling at $150-160 below the domestic price.” such as Posco, Maruti Suzuki, Hyundai and Steel imports have increased from China, Korea ArcelorMittal Brasil, along with Indian industry, and Japan. After much lobbying, a safeguard duty made a strong pitch against the imposition of a has been imposed by the government on hot rolled safeguard duty on steel. They argued the move coils. Also, through the past few months, there have would be counterproductive to the government’s been two rounds of import duty increases. Make in India campaign and that it would impact Copper smelters to cut production foreign investments coming to India. Nine large copper producers in China have The public hearing called by the Director General agreed to cut refined metal production by of Safeguards (DG Safeguards) a few days back more than 200,000 tonnes in 2016 from this year, also saw participation from country delegations an executive at one of the producers said. The and embassy representatives. These included the agreement followed a meeting by the producers European Union, Japan, China, the Ukraine, the recently in Shanghai to discuss coordinated Russian Federation, Taiwan and Brazil. India has output cuts to support prices in Shanghai and the a free trade pact with South Korea and Japan, London Metal Exchange after prices plunged to under which the countries enjoy substantial duty their lowest in more than 6 years. benefits on steel imports. Source: Business Standard Posco and Hyundai argued the steel imported from South Korea is for captive use and not for POSCO Named World’s Most Competitive domestic sale that could have an impact on the Steelmaker for 6th Year domestic steel companies. Posco contended it was forced to import from Posco has been named the world’s most its parent company in South Korea as the local competitive steelmaker in a global industry plants in India declined to supply steel products report for the sixth consecutive year. In an annual due to their own inability to produce the required assessment of 36 steelmakers worldwide, global quality and quantity.
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A Great Seamless Success for Trade and Industry
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Posco alone imported nearly 950,000 million A Great Seamless Success for Trade and Industry tonnes of hot-rolled steel between May 2014 and September 2014, accounting for 30 percent of total imports of the raw material. If excluded from the total steel imports, there is no surge in steel imports, it argued. In all, there were 29 presentations from Nippon Steel, Posco Maharashtra, Posco Korea, Mitsui, Hyundai Steel, Hyundai Motors, China iron and Steel Association, Federation of Industries of India, Federation of Association of Maharashtra, RKB global and Tube Products of India, among others. DG Safeguard, Vinay Chhabra, asked interested parties to make written submissions. The government will take a final decision on the duty by February after hearing all interested parties. In September, the government imposed a 20 percent safeguard duty for 200 days on the import of hot-rolled flat products of non-alloy and other alloy steel, in coils of a width of 600 mm or more. The decision was taken on the basis of preliminary findings and the recommendations of the DG Safeguards which comes under the revenue department of the finance ministry. Nippon Steel argued the steel required for auto production should be exempt from safeguard duty as the domestic industry does not have the capability or the technology required for production. Tata Steel, Jindal Steel and Bhushan Steel supported the three petitioners – JSW Steel, Essar Steel and the Steel Authority of India. “Hot-rolled coil is consumed as a basic raw material by many downstream engineering units in the country. Hence, the levy contradicted the government’s initiatives like ‘Make in India’, ease of doing business and Sabka Saath, Sabka Vikas,” H L Bhardwaj, secretary-general of India, argued in his presentation. He added the imports made before the safeguard duty notification but delivered later must be exempt from the levy. The Federation of Association of Maharashtra noted the petitioners in the case, such as JSW and SAIL, have made profits. Safeguard duty is allowed under World Trade Organization rules as a temporary measure for a specified period to check damage to a country’s domestic industry from cheaper import. The market share of steel imports doubled from six percent to 12 percent in absolute terms between
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2013-14 and 2015-16, preliminary findings showed. regularly at prices 10 percent below what they Japan, South Korea and China accounted for charge locally. This, according to The Economist, about half the iron and steel imports into India is the textbook definition of dumping. No wonder, then, Chinese steel products are from time-to-time in the first six months of the financial year, worth attracting retaliatory duties and on occasions, anti- about $3 billion. Imports made up five percent dumping imposts, too, in various parts of the world. of the country’s total production of the under In September, India put a 20 percent safeguard investigation steel products (hot-rolled coil) in the duty on imports of hot-rolled flat steel. The growing year to end-March 31, 2014. arrival of foreign-origin steel (not only from China) Source: Business Standard taking advantage of a liberal import duty regime here is cornering a significant share of Indian steel Steel prices react to Chinese exports demand at local producers’ expense. deluging world market Second, world economic growth, particularly in emerging nations, will have to be much stronger Steelmakers all over the world are facing a crisis for better use of steel capacity. But steel demand of low demand and very low prices, which leave in China, which fell to 711 mt in 2014, will further either slender or no margin for producers. Let us contract 3.5 percent this year and then by another consider the case of ArcelorMittal, the world’s two percent in 2016. But Chinese steel production largest steel producer. In the third quarter of in the first nine months of 2015 was down only 2.1 2015, its year-on-year sales dropped to $16 billion percent to 609 mt. The implication of trends in from $20 billion, causing a net loss of $711 million Chinese demand and production is disturbing for against a profit of $22 million. This is in spite of other steel producing countries. China’s record the European part of the company, represented steel export of 11.5 mt in September is a pointer by erstwhile Arcelor, and the group’s US and to the country finishing 2015 with overseas sale of 110 mt against last year’s 94 mt. The country Canadian operations are mostly about products is, therefore, set to export steel this year equal to at top end of value chain requiring application of what Japan, the world’s second largest producer, technology that is a close preserve of a few. If this makes annually. Low demand and surplus is the condition of an industry leader then the torrid capacity have resulted in global steel capacity weather faced by those making commodity use sinking to 68-69 percent. In the context of steel as in India is easily understandable. We have the industry’s high fixed costs, mills should run at seen quite a few highly disquieting working of least at 80 percent capacity to be able to use Indian steelmakers – both in the public and private raw materials efficiently and retain pricing power. sectors – in the September-ended quarter. It’s no surprise, then, that in recent periods, the The global steel crisis is largely due to an fall in steel prices has been sharper than in raw overcapacity estimated at 600 million tonnes materials, particularly iron ore. So the spread that (mt) by the rich country club the Organisation steel producers are to earn is squeezed. for Economic Cooperation and Development From ArcelorMittal to Tata Steel Europe, every (OECD). Worryingly for the global market, half of steelmaker will, therefore, be heard complaining that excess capacity rests in China, which has its about damage to steel prices being caused by compulsions to make a lot more steel than it needs. China. But producers such as Posco and Nippon How soon all that extra global capacity is going Steel with large proportions of high-end steel in to go away depends on two things: First, China’s their portfolios requiring the use of very advanced technologies are not faring as badly as commodity progress in scrapping capacity that is uneconomic steel makers. Is not there a lesson for major Indian and environment damaging. It is common steelmakers here? They should ideally make knowledge that the provincial governments in the attempts to rope in steel companies in Japan country remain resistant to mill closure to protect and South Korea as joint venture partners with a jobs and score province-centred growth often flexible approach to equity ownership and sharing to the point of angering Beijing. What is obvious of management control to make electrical and is, the provinces are providing large dollops of high auto grade steels for which we are import- subsidy to sustain steel production. Metal Bulletin dependent. As we chase an ambitious capacity says Chinese companies are found exporting steel
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of 300 mt in another 10 years, a focus area should Challenges and opportunities for the ideally be to build competence to make steels aluminium industry for which we are technology-deficient. Indian aluminium industry has embarked upon Source: Business Standard implementing a number of greenfield projects Railways sign Rs 2,500 crore pact for to increase production of aluminium at a rapid stainless steel freight wagons pace besides creating enormous employment opportunities to fulfil the mission of our Prime Indian Railways recently signed an initial pact Minister – “Make in India”. with rolling stock manufacturer SAIL-RITES Bengal Apart from its potentially large growing market, Wagon Industry Ltd. (SRBWI) for procurement of India is endowed with large deposits of high high-class stainless steel freight wagons at a cost quality bauxite ore, power (coal) and formidable of Rs 2,500 crore over 10 years. pool of manpower. The industry is forging ahead with rapid expansion in both primary metal and The joint venture between steel manufacturer downstream sectors. With the robust economic SAIL and rail ministry’s arm RITES was set up in 2011. growth in the country and changing life styles, the The company operates a wagon factory at Kulti stage is set for an exponential growth in aluminium in West Bengal, from where the wagons will be consumption in India. All the end-use sectors, such supplied. “The pact includes a commitment for as transportation, electrical, construction and procuring 1,200 new and 300 refurbished wagons packaging have witnessed aggressive growth, every year over a period of 10 years,” Railway which makes aluminium’s future even brighter. Board’s Member-Mechanical Hemant Kumar said. Indian aluminium industry, with its investments of around Rs 1.2 – 1.5 lakh crore, has employed He added the factory at Kulti had been set up at almost 7.5 – 8 lakh and with this new expansions a cost of Rs 120 crore and would be developed the employment to increase substantially. The as a centre of excellence. demand for the wonder metal – aluminium, in India is also growing at double digits and will The assured offtake pact with the railways also reach 3.5 million tonne from current levels of 2.8 envisages procurement and installation of million tonne due to the emerging applications in equipment at the factory by RITES. transportation, aerospace, packaging, building Steel secretary Aruna Sundarajan, who was also & construction. present on the occasion, said the steel ministry However, currently, the industry is facing numerous was working on an ambitious plan to ramp up challenges. Similar to all other industries, the domestic steel-making capacity from 100 million aluminium industry has also been hit by the global tonnes (mt) to 300 mt over the next few years. slowdown, due to continuous increase in input The increased steel supply would cater to the prices & interest rates, slowdown in demand, low & railways’ massive modernisation and expansion delayed realisation, shortage of inputs etc. These plan, she said. factors are causing threat to the sustainability and the very existence of the entire industry. Exports Railway Board Chairman A K Mital said the by Indian aluminium industry have been unviable assured supply of wagons over 10 years would due to high product cost as compared to other help Indian Railways improve freight loading from competitors in the global markets especially from 1.1 billion tonnes (bt) currently to 1.5 bt over the China and Middle East smelters. next five years. “This JV will give new wagons of increased capacity and better technology. Also, Challenges this factory will come up in an area (East) that contributes to a bulk of the loading,” he said. • Falling LME prices • Rising cost of production Source: Business Standard • Raw material availability • Increased imports
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A TributeA Tribute to toDr. Dr. S RR Pramanik Pramanik Dr. S R Pramanik, a reputed metallurgist of the country and a very senior member of the Indian InstituteDr. S R ofPramanik, Metals, a breathedreputed metallurgist his last ofat th Kolkatae country on and 29th a very November senior member 2015 of at the the age th of 89. Indian Institute of Metals, breathed his last at Kolkata on 29 November 2015 at the age of 89. Dr. Pramanik was a student at Presidency College Kolkata and a gold medallist of 1950 batch in Dr.metallurgy Pramanik wasat BE a studentCollege, at Presidency Shibpur. AfterCollege completion Kolkata and ofa gold his metallurgicalmedallist of 1950 degree, Dr. Pramanikbatch wentin metallurgy to Germany at BE Coll whereege, Shibpur. he obtained After completion his PhD of inhis Industrial metallurgical Metallurgy degree, from Aachen Dr.University, Pramanik Germany. went to Germany Dr. Pramanik, where he afterobtained his hisreturn PhD fromin Industrial Germany, Metallurgy joined from Rourkela Steel PlantAachen and University,was the firstGermany. recipient Dr. ofPramanik, National after Metallurgist his return Dayfrom Award.Germany, Subsequent joined to his RourkelaRourkela tenure Steel Dr. Plant Pramanik and was joined the first Durgapur recipient Steelof National Plant Metallurgistas Chief Metallurgist Day Award. in 1964 where heSubsequent worked forto hismore Rourkela than tenurea decade. Dr. Pramanik After joinedhis tenure Durgapur at DurgapurSteel Plant Steelas Chief Plant, Dr. PramanikMetallurgist joined Mecon, in 1964 Ranchi where heas aworked Chief for Metallurgical more than a Advisor.decade. AfterHe also his workedtenure at as CEO of SAIL R&DDurgapur Centre Steel at Ranchi.Plant, Dr. Pramanik joined Mecon, Ranchi as a Chief Metallurgical Advisor. He also worked as CEO of SAIL R&D Centre at Ranchi. I had the privilege of working with Dr. Pramanik for several years and found him a highly technicalI hadand the competent privilege of workingindividual. with HeDr. usedPramanik to go for deepseveral into years the and details found andhim ahad highly excellent analyticaltechnical ability. and He competent had the leadershipindividual. He attributes used to go todeep identify into the the details latent and potential had excellent of officers working underanalytical him ability. and He used had theto tapleadership the same attributes optimally to identify in the latent interest potential of the of officersorganization. Dr. Paramanikworking also under worked him and as used a Chief to tap Editorthe same and optimally Advisor in theof IIMinterest Metal of theNews organization. published from Kolkata. Dr.This Paramanik position healso held worked for asseveral a Chief years. Editor Duringand Advisor his tenure of IIM Metalthe stature News published of Metal News grew as anfrom excellent Kolkata. This document position he of heldtechnical for several dissemination. years. During his tenure the stature of Metal News grew as an excellent document of technical dissemination. During my interaction with Dr. Pramanik for over a decade, I found him an excellent human
being with the qualities of both head and heart. He was extremely hard working and very During my interaction with Dr. Pramanik for over a decade, I found him an excellent sincere in whatever responsibility he had undertaken. Dr. Pramanik is survived by his wife human being with the qualities of both head and heart. He was extremely hard working and a son who works as a software engineer. and very sincere in whatever responsibility he had undertaken. Dr. Pramanik is survived His demiseby hishas wife created and a son a voidwho works in the as metallurgical a software engin fraternity.eer. It has caused an irreparable loss to the metallurgical industry in general and IIM in particular. Our posterity in the metallurgicalHis demise stream has will created miss a him void immensely. in the metallurgical fraternity. It has caused an irreparable loss to the metallurgical industry in general and IIM in particular. Our posterity in the I offer mymetallurgical sincere condolences stream will miss to him a brilliant immensely. metallurgist and the bereaved family and wish that his soul rests in peace. I offer my sincere condolences to a brilliant metallurgist and the bereaved family and wish S C Suri that his soul rests in peace. Hon.S CMember, Suri IIM Hon. Member, IIM
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In the last 4 years ie since FY11, the imports have the country for critical application sectors such as increased from 881kt in FY 11 to 1563 kt in FY15 defence, aerospace, automobiles etc., where @CACR-15%. These imports in the upstream are primary metal is generally preferred to scrap. from Middle East and downstream are from Therefore, the desired accelerated growth of China. aluminium industry both in terms of production Middle East and China have huge surpluses. and consumption will be one of the key drivers China gets many incentives from government like of growth of the nation’s economy. In order to power tariff discounts, export rebate (15% to foil accomplish this goal, it is critical that the industry and 13% to rolled producers), freight reduction and Government work together to draw up a while Middle has an advantage of low power strategy to ensure that the growth of aluminium cost. Both the countries have a focus on India industry is well guided. due to close proximity and India is a natural Aluminium Association of India (AAI), the apex market for them. Middle East has a capacity of 5.6 body representing entire spectrum of Indian million tonne and surplus of 3.2 million tonne with aluminium industry in the country, having close another 0.85 million tonne being added in next 5 rapport with various ministries, having always years. China also has a huge capacity in primary enjoyed the ministry’s patronage, support metal and a substantial surplus in downstream. and guidance in all activities, will help industry The rolled product production surplus is 1 million to approach appropriate ministry to remove tonne and is expected to increase to 2.1 million obstacles coming in the way of growth of the tonne by 2019. With the devaluation of RMB, aluminium industry especially in primary metal the Chinese companies’ competitiveness has industry as well as downstream sector. Besides improved further and India has to protect itself this, AAI is also closely collaborating with various from the surge in imports from these 2 countries. overseas associations and it is imperative on the China due to its export rebate policy is exporting part of aluminium industries to take advantage of foil and rolled products to India. this close association for developing downstream The government firmly believes that the growth industries on the state-of-the-art technologies. AAI of the aluminium value chain in India will not will assist Indian aluminium industry in establishing only benefit the incumbents, but also benefit the close collaboration with aluminium industries communities at large by generating additional through International Aluminium Associations. jobs and the government by generating Services of AAI are available to the members additional revenues through taxes, etc. Being for exchange of technical information and also an eco-friendly “green” and recyclable metal, transfer of technology through collaborative aluminium will also help in conserving energy and efforts, as AAI has already signed MoU with our natural resources. Aluminium Association of America. It is imperative on the part of Indian aluminium Aluminium Association of India (AAI) help industry to ensure accelerated growth in the growth of Indian Aluminium Industry production of primary metal and associated downstream products so as to meet the principle By disseminating vital information on challenges of aluminium industries. Aluminium technological developments and on various usage and consumption in the country is very low applications of aluminium, all of which are as compared to global standard. Dependence significant to India vide National & International on imported primary metal and scrap is not Seminar / Workshop / Conferences. By providing healthy for Indian aluminium industry to survive statistical / Techno-commercial information on and grow, as global economic conditions as well aluminium to the members, Government etc. as political reasons will affect such a situation as through print and electronic media. It also offers being dependent heavily on imports. Further, advice on technical problems, marketing issues. India having vast resources for production of By forwarding large number of enquiries received primary metal should continue to produce more from within country and abroad regarding various and more primary metal and be consumed within aluminium products.
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Mission in supply of 10-15 million tonne of copper ore in India. In addition, another 15 coal blocks have • To promote utilization and growth of been explored and will be auctioned within a aluminium and its varied applications like year, he said. building packaging, transportation, power generation, aerospace, automobile, Investment sought telecommunications, etc. “The Centre is keen to attract private investment • To Create a common forum for aluminium in exploration, and will finalise the new National industry and its constituents to formulate Exploration policy by January,” said Kumar. common policies and strategies maintain close liaison with Government The Centre will have Rs 450-500 crore in the National departments, project and further the Mineral Exploration Trust by next year-end. As per interests of aluminium production and the new Mines and Mineral Development Act, distribution, build awareness on health, mining companies have to contribute 2 percent environment, safety and energy of royalty to the Trust, for facilitating exploration. • To enhance the role of aluminium in the “The Centre has identified a copper mine, with national economy as an eco-friendly 26.3 million tonne reserves and trace of 1.3 to 1.5 metal of unique properties. mt of gold and silver at Alwar district in Rajasthan. This will be auctioned in one year. We have found • To disseminate knowledge on aluminium mineral trace over 60,000 sq. km in Rajasthan, products, technologies, marketing, etc. Madhya Pradesh and Jharkhand. • To interface between the aluminium “Of this, 1.5 mt of copper reserve is established industries, government and institutions of over 20,000 sq. km and more mineral ore can be higher learning, to promote the cause of extracted if the remaining area is explored,” he aluminium. said. Source: MMR The Centre is also considering an amendment to the new Mines and Mineral Development Act, to Centre to auction 12 copper mines by allow transfer of captive mines in case there is an next year asset sale. To ensure supply of 10-15 mt of ore; mines in JP Group’s bid to sell its two cement plants to Rajasthan, Gujarat, Maharashtra identified. UtlraTech Cement and Birla Corp. has been delayed as the new Law does not allow transfer The Centre plans to auction 12 copper mines in of limestone lease with the sale of asset. the next one year, in order to ensure ore supply of 10-15 million tonnes (mt). “Though the amendment will not happen anytime soon, it is being discussed at various levels,” said Currently, only Hindustan Copper has a captive Kumar. copper mine, while other companies import copper concentrate and convert them to copper On the industry demand for anti-dumping duty cathode and rods. on copper, Ravi Capoor, Joint Secretary (Ministry of Commerce and Industry), asked the industry Speaking at the India Copper Forum a few days to push for safeguard duty, as it was done in the back, Balvinder Kumar, Secretary (Ministry of case of steel. Going by import data, Capoor said Mines), said the Centre has identified five copper there is a clear case for safeguard on copper mines in Gujarat, three in Rajasthan and four in plates and tubes. If the industry can bring up Maharashtra for auctioning. their case to the Centre, we will respond in two Of these, he added, prospecting licence has months, he added. been issued for two blocks in Maharashtra and Apart from pressing for safeguard, the industry one in Rajasthan, with 11 million tonne of copper should also work on various quality and energy ore to be auctioned by February. This would result
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24 25 Is India ready to take the mantle from China?
Yi zhu, in an email interaction with MMR, spoke about the nitty-gritty of China’s metals industry and its impact on global and Indian metals sector.
Excerpts:
Q: In the event of Fed delaying rate hike how do you see the movement in the global metals market and its impact on Indian metals industry?
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NEWS LETTER ISSUE NO. 94/2015 VOL. XCIV “MONTHLY” Date: 30.11.2015
efficiency standards, which the exporting last July. countries are not meeting, and convince the Q: Globally rising supply and weak demand Centre to notify them, he said. have weighed on metal prices. Please Source: Hindu Business Line give your views on this demand supply Is India ready to take the mantle from China? mismatch? Yi zhu, in an email interaction with MMR, spoke A: Rising supply and a slower demand growth in about the nitty-gritty of China’s metals industry China have pressured metal prices. As China and its impact on global and Indian metals sector. switched its economy from export-oriented to domestic-consumption, the growth rate Excerpts: decreases. As China’s demand is the large Q: In the event of Fed delaying rate hike how contributor to the global markets, China’s do you see the movement in the global changing economy is having a massive metals market and its impact on Indian impact on bulk commodity markets. metals industry? Metal prices may stay near depressed levels in A: Fed’s interest rate hike is likely to impact 2016, based on consensus, as new supplies keep negatively on US dollar denominated coming to market despite a lack of evidence metal prices. India’s steel output keeps that a recovery in demand is imminent. Until growing. Even though its steel output growth overcapacity is cut and demand picks up, has slowed in the past three years, m a i n l y metal prices are likely to remain subdued, and due to delays in securing environmental producers can expect narrowing profit margins. clearances for projects. The country’s Q: What are they key factors for stupendous Five-year Plan for 2012-2017 sets that rise in invisible stocks which led to distorting capacity will rise to 142 million metric metal inventories? tonne by 2017, up more than 40% from 2014. And capacity is planned to be further A: The decline in Shanghai Future Exchanges’ increased to 300 million tonne by 2025. copper and lead inventories since late March do not necessarily mean demand To protect domestic producers, India has increased is improving. Some inventories are now import taxes on steel products and imposed anti- held at off-exchange warehouses and dumping charges against Chinese steel mills. are considered “invisible stocks,” as no The country’s steel imports jumped 29% in 2014 official data on them is available. Bonded and China is the largest sourcing country due to warehouses are one form of invisible stock. cheaper prices. Indian steel producers have 37 Metals can also be held in on-exchange million tonne of new capacity under construction deliverable formats, such as molten or planned, according to Bloomberg intelligence aluminium. analysis. That equals to 35% of capacity as of year- end 2014. The tally includes 14.5 million tonne due The rising use of such stocks reduces exchange to come online by the end of 2016. inventories, while total distribution amounts may actually be growing. Indian steel producer can now import high- quality iron ore at about the same cost as lower- Q: Please provide us an overview of investment quality, domestic feedstock thanks to falling in late-cycle commodities in the past few global prices. The situation is hurting Indian miners years and also present your outlook? while boosting margins at the nation’s steel mills. A: China is still increasing investments in late- Iron ore prices have more than halved since the cycle commodities such as base metals. start of 2014, and touched a six-year low in the This translates into continuing capacity first half of this year. India has raised export duties expansion for aluminium and copper used on iron ore, motivated by concerns about the in the latter stages of the construction cycle, availability of the raw materials for its steelmakers. while steel capacity has already peaked. The country became a net-importer of iron ore China will probably add 3.9 million tonne and
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800,000 tonne of capacity for aluminium and be a key issue for Indian steel mills to expand copper this year, according to BI analysis, capacity. Steel producers may face power whereas steel capacity will drop by 5 million constraints stemming from supply deficits and tonne. China’s investment in non-ferrous underdeveloped transmission lines. In addition, metal production has increased more than while the country is coal-resource rich, it relies on 12-fold from 2003 to 2014, and continues to imported coking coal, the key fuel for steelmaking. rise this year. Japanese, Korean and Chinese steel companies Q: What is your opinion on China’s investment have in India, while the major setback is a plans in infra, railways and the One Belt, One regulation maze. Posco scrapped its plan for Road Project. Would it boost the demand for a 12 million-tonne-a-year steel plant in Odisha metals? state that was conceptualized in 2005 due to difficulties in acquiring land and iron ore mines. A: According to a recent analysis by Bloomberg ArcelorMittal also canceled its plan to build a Intelligence, China’s forthcoming plans to steel mill in Odisha. accelerate railway and other infrastructure projects have yet to translate into more Prime Minister Modi’s government seeks to attract demand for metals. Implementation of the foreign investments and will have to prioritize projects may not have started, as metal finding a solution to these issues. producers are still waiting to receive orders. Q: How do you see Chinese overcapacity with China’s local governments, which usually rising exports hampering manufacturing match Beijing on infrastructure investments, industry in India? may lack funds this year as tax proceeds and land sales decline. Demand may rise A: To protect domestic producers, India, as for metals once the construction starts on mentioned above, has already raised import infrastructure and railway projects. taxes on steel products and imposed anti- dumping charges against Chinese steel Q: Do you think India is ready to take the mantle mills. The country’s steel imports jumped 29% from China? in 2014 and China is the largest sourcing A: China’s demand for steel is retreating from country due to cheaper prices. the double-digit growth rates of the past 10 Q: Volatile risk environment has contained years, as Beijing tries to shift the economy to companies’ ability to stay agile and focus on domestic consumption rather than opportunistic. Your comment please… exports. The country may cut five million tonne of capacity this year. A: Metal price variability has been high and is likely to continue to be so. Historically, Since China introduced its tougher environmental companies have managed this variability protection policies in 2013, capacity closures using cost pass-through, derivatives and of steel mills have been accelerating in several cost cutting. These strategies are no longer regions. Local governments are determined sufficient to do the job. Companies need to to achieve capacity closure and pollution think more broadly and strategically. emission reduction targets, which are now key performance indicators, replacing previous In addition, the current global business GDP-focused measures. Producers that don’t environment creates emerging risks – for metals comply and those facing high cost for meeting producers that are potentially more significant the requirements will be under pressure to exit the than metal prices. In order to operate effectively market. in this environment, forward thinking companies need to define and assess their risks, develop Whether India can take the steel torch from China broad sets of alternatives, apply multiple depends on better regulations, power availability, strategies in concert, be prepared to respond and infrastructure improvements. to unforeseen events and develop the agility The availability of stable power supply may to capitalize on opportunities as they present
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themselves. Executives should understand that the availability of the raw materials for its volatility is not always a problem. steelmakers. The country became a net- importer of iron ore last July. A well-informed and prepared company can use economic dislocations to its advantage, locking New copper and iron ore mines may continue in input costs or exchange rates at low levels in to come on stream. Copper miners are planning markets that have overreacted and oversold about 7.88 million tonne of new copper supply, commodities or commodity linked currencies. or a 43.5% increase by 2020 into a global market Furthermore, in select cases, there are substantial that mined 18.1 million tonne in 2014. Large-scale upsides to naked exposure to the market; this can iron ore producers are trying to cope with further benefit a company if it has strong evidence to price declines by raising output to lower unit costs support such an overall strategy. and by improving operating efficiency at mines. Some high-cost iron ore mines have been pushed Q: How would China’s move to promote yuan out of the market due to loss-making. affect commodities trading business? Q: Do you think that India’s steel sector could A: China’s recent steps to promote its currency emulate China’s feat of double-digit growth for greater global acceptance include setting of the past? up five offshore yuan centers, launching the Shanghai-Hong Kong Stock Connect, and A: As Prime Minister Narendra Modi Pushes for widening the yuan-trading band. The rise of improvements in India’s infrastructure and the currency in global markets may promote housing, the nation’s steel consumption is trading of yuan-denominated commodities set to accelerate. China’s demand for steel, and increase China’s ability to influence meanwhile, is retreating from the double- prices. It may also help China’s small-scale digit growth rates of the past 10 years as metal producers gain access to offshore- Beijing tries to shift the economy to focus on funding channels. domestic consumption rather than exports. The yuan’s rise in global markets may promote China’s steel capacity peaked last year as commodities trading denominated in China’s cuts finally take hold. The country may cut 5 currency, increasing its pricing power. While million tonne of capacity this year, according to China is the largest importer and consumer of Bloomberg Intelligence analysis. That compares iron ore, copper ore, bauxite and other goods, with net additions of 20 million tonne last year it’s a price taker, unable to set the terms because and 50 million tonne in 2013. China steel capacity most commodities are still denominated in increased sharply following the government’s RMB dollars. International commodity trading uses 4 trillion, post-financial crisis stimulus package. The mostly overseas exchanges for benchmarks, and industry has almost no entry barriers due to the transactions are settled in dollars. easy availability of technology and equipment, favourable financing rates, and support from Q: What is your outlook on copper and iron local governments. ore surging supplies as new mines come on stream? Source: MMR A: Indian steel producers can now import high- Make in India quality iron ore at about the same cost as The ‘Make in India’ initiative was launched on lower-quality, domestic feedstock, thanks to September 25 last year. It is aimed at making India falling global prices. The situation is hurting a global manufacturing hub and create millions Indian miners while boosting margins at of jobs. Under the programme, the Government the nation’s steel mills. Iron ore prices have has identified 25 key sectors in which India has the more than halved since the start of 2014, potential of becoming a world leader. Necessary and touched a six-year low in the first half steps have been announced to improve ease of of this year. India has raised export duties doing business in the country and relax FDI norms on iron ore, motivated by concerns about in several sectors.
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Thrust sectors include automobiles, chemicals, Madhya Pradesh and Gujarat. The DMIC project, IT, pharma, textiles, ports, aviation, leather with the government of Japan as its partner, Tourism and hospitality, wellness, and railways feeds significant nourishment to a geographically are others. The documents will provide growth drivers, investment opportunities, sector-specific FDI, other policies & related agencies, while most sectors need Central Governmental clearance for FDI, the crucial tourism sector has been happily clubbed in the ‘automatic investment’ category. India has vastly under-used tourism potential, even though the country offers one of the most geographically diverse holiday options– the world’s highest and longest mountain range of the Himalayas, a 7,517 km (4,671 mi) long coastline filled with seaside resorts and secluded beaches, the Ganges and coastal rivers, tropical and alpine forests, adventure sport hubs and ancient cities, including 30 World Heritage sites. Tourism in India, particularly domestic tourism, could see unprecedented growth thanks to a historic Indian governmental decision recently to open investment in railway infrastructure to 100% FDI under the ‘Automatic’ route. A key ‘Make in India’ project is the Delhi-Mumbai Industrial Corridor (DMIC), with the 1,483 km long, high- capacity Dedicated Railway Freight Corridor (DFC) as is its backbone. The project aims to develop 24 new manufacturing cities along the Delhi-Mumbai Industrial Corridor, with each city given high quality infrastructure – improved power and water supplies, efficient public transport and waste management systems. With a year 2019 deadline, the first phase has seven cities being developed – two in Maharashtra and one each in the states of Rajasthan, Uttar Pradesh, Haryana,
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crucial sector of India’s economy. The DMIC states of Maharashtra, Rajasthan, Uttar Pradesh Way to Reduce Stress on the Job and Gujarat contribute 43% of India’s GDP, over For many people, corporate life can be 40% of industries and industrial workers, and over a pressure cooker. Here are some simple 50% of India’s industrial output and exports. The techniques you can use to reduce stress and new DMIC cities are expected to cope with tension on the job. increased pressures of urbanization, and lead India’s economic growth across the next two Screening decades. Working alone, in long stretches, is far more Japan features prominently in India’s new practical – and productive – than working in development and investment drive, such as the the corporate environment, where your open Investor Facilitation Cell of Invest India, a crucial door is an invitation for everyone to interrupt liaison component in the ‘Make in India’ initiative. you, regardless of how busy you are. If you Invest India is also a part of the Japan Plus initiative find these constant interruptions stressful, it created to deepen economic ties between may pay you to screen calls and visitors. India and Japan, and to fast-track investment proposals between two of Asia’s largest Unlisted Phone Number economies. Recently, Japan has announced $15 billion low interest loan to India for a bullet train Few things are as intrusive as a work-related from Mumbai to Ahmadabad. phone call received at home. If you are bothered by too many such calls from The Indian Railways, the world’s eighth largest subordinates or supervisors, consider getting employer with 1.4 million people in its payroll, an unlisted number. If company policy now estimates a record $120 billion investment in dictates that people at work must have the next five years for upgrading and expanding access to your home number, you might want its network. Four hundred railway stations across to buy a telephone answering machine. India are due for an elaborate upgrade, through a transparent e-bidding process. Delegation Foreign direct investment (FDI) into the country Do you have too much work to do? Delegate has witnessed a 31 percent increase during Aril- it. Don’t think you’re the only one who can June period of this fiscal. First seven months of the do your work. You’d be surprised at what your landmark ‘Make in India’ initiative saw Foreign co-workers can accomplish for you. Direct Investment (FDI) soaring by 48% as per the report from Ministry of Commerce and Industry. Deep Breathing Foreign Institutional Investors (FILs) channelled a record $40.92 billion into India from October Psychologists have developed a number of 2014 to April 2015, an unprecedented 717% FDI relaxation techniques that can help reduce upsurge in the year-on-year period. stress on the job. One of the most basic techniques is deep breathing. To practice India’s Commerce Ministry said the record it, sit in a comfortable position with your FDI upsurge indicated growing trust of global hands on your stomach. Inhale deeply and investors in the country’s economy, and in slowly. Let your stomach expand as much as latest reforms to cut red tape. “A number of possible. Hold your breath for five seconds. regulations and procedures were either done Then exhale slowly through pursed lips, as if away with or eased,” said a Government of whistling. Repeat the cycle three or four times. India update. Foreign investors have now shown unprecedented interest for investment in the Contributed by manufacturing sector. Shri K L Mehrotra Chairman – IIM-DC & Former CMD – MOIL Source: Steel Tech E-mail: [email protected]
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Go Farther Than You Can See
Too many people expect little, ask for little, receive little and are content with little. Having a dream is not trying to believe something regardless of the evidence; dreaming is daring to do something regardless of the consequences. I sincerely believe that every one of us would accomplish many more things if we did not so automatically view them as impossible. “Don’t wait for all the lights to be green before you leave the house”. Don’t ever say that conditions are not perfect. This will always limit you. If you wait for conditions to be exactly right, you will never do anything. Those who dare, do; those who dare not, do not. Don’t do anything that doesn’t require vision. “God made the world round so that we would never be able to see too far down the road.” The person who dares for nothing need hope for nothing. I really believe that the way to live your life is “outside of the box.” The future belongs to those who can think unthinkable thoughts, see where no one is looking and take action before it’s obvious. Let your faith run ahead of your mind. Significant achievements have never been obtained by taking small risks on unimportant issues. “If you’re hunting rabbits in tiger country, you must keep eye peeled for tigers, but when you are hunting tigers you can ignore the rabbits”. Don’t be distracted by the rabbits. Set your sights on “big game.” You have reached stagnation when all you ever exercise is caution. Sometimes you must press ahead despite the pounding fear in your head that says, “Turn back.” • Our destiny says to us, “Come to the edge.” • We say, “It’s too high.” • Come to the edge.” • We say, “I might fall.” • “Come to the edge,” Destiny says. • And we stepped out. • And it pushed us. • And we flew. This is the eighteenth of series of “Nuggets of truth” which are our sound food for soul. Get ready to blow the lid off our limited Thinking & create your recipe for happiness & success. Compiled by Shri K L Mehrotra Chairman – IIM-DC & Former, CMD – MOIL E-mail: [email protected]
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