Tata Steel Annual Report 2012-2013 - page 13

The journey towards enduring sustainability
The 2.9 mtpa brownfield expansion
was perhaps the most ambitious
project undertaken by the Company.
steel capacity of 9.2 mtpa (equivalent to crude steel capacity
of 9.7 mtpa). We should be ready with our first phase of
implementation of the Kalinganagar project by the end of
Financial Year 2014-15, which effectively means, that Tata Steel
will continue to enhance volumes in the next 36 to 48 months.
We will continue to leverage our distribution capacity and
focus marketing efforts towards new products developed,
finding new customers and enhancing service standards as
we have done in the past. This is the big differentiator for Tata
Steel in the market place.
On the other hand, the European operations continue their
journey towards rationalisation of its cost base through
several initiatives and pursue product differentiation to make
the business fitter in the future. Our focus is on improving our
supply chain capability, IT systems and the product range.
This combined with right sizing is expected to provide the
platform for enhanced competitiveness in the future.
Q. Many steel sector investments announced in recent
years, have not proceeded as planned. What are the
key reasons behind this and the steps required for the
smooth execution of these investment plans? How is
the ramp up of the 2.9 mtpa expansion planned?
In the not so recent past, several capacity addition plans were
announced in India by domestic and global steelmakers.
India was the chosen hub as it is rich in resources, had
comparatively cheaper factors of production and served as a
captive market with a huge growth potential. In the last two
years, India too has been facing uncertainty in its economic
growth due to many factors – both internal and external.
Simplification of the process of land acquisition, expediting
the process of environmental and forest clearances and
putting in place a mechanism for mining allocations, in our
view, will give the required impetus to steel investment
plans and lend certainty to project execution.
The 2.9 mtpa brownfield expansion was perhaps the most
ambitious project undertaken by the Company. To undertake
the brownfield expansion in excess of 40% volume on a
running plant, has its own challenges for the engineering,
projects and the operations team. The teams rose to the
occasion and have done a great job. This expansion covered
the entire value chain of the integrated steel operations –
from the expansion of the raw material facilities at the mines
to the entire steel manufacturing operations, covering Raw
Material Handling systems, Coke plant, Pellet plant, Steel
making and finishing facilities.
The ramp up of the capacity has been planned in phases. We
have produced and sold about 1 million tonnes additionally
in Financial Year 2012-13 and are planning to add another
one million tonnes in the next financial year with the balance
capacity coming in Financial Year 2014-15. The production
ramp up is linked to some of the support facilities like the
coke ovens which are being commissioned in phases. In the
last quarter of Financial Year 2012-13, we sold almost 2.3
million tonnes which is the highest ever quarterly volume in
2.9 mtpa expansion at Jamshedpur, India
Annual Report 2012-13
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