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Challenges & Future
Scenario of Steel Industry

PRESENTED BY : GS DHIR
Executive Summary


Globally, steel players have been operating in a challenging environment with rising input
costs and persistent lower capacity utilization. This is driven by Low demand growth in
developed markets, accompanied by a structural shift in the global steel industry to
developing countries like China and India.



Over the last decade, Indian steel companies have consistently achieved higher earnings
before interest depreciation taxes and amortization (EBIDTA) margins as compared to their
global peers and have delivered steady growth despite external challenges.



Having established quality assets, Indian steel companies are now well poised to take
advantage of expansion and growth opportunities in India. However, six long-term
challenges are confronting the Indian steel industry’s growth aspirations

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2
•Volatile domestic iron ore supply is forcing Indian steel companies to pay higher prices or
import this key raw material thereby exposing them to global iron ore price volatility.
•Flat products supply will exceed demand, leading to an overcapacity situation. This
coupled with the muted demand growth will put significant pressure on margins.
• Customers are maturing and increasingly demanding value-added products and services.
•Existing supply chains are stretched in order to cope with the wide range of customers and
product specifications— original equipment manufacturers (OEM) at one end, to the rural
retail markets at the other—which impact service levels.
•In the race to maintain market share, incumbents have taken on Greenfield and brownfield
expansion plans at a pace and scale unprecedented in the Past. Skill gaps and other
challenges have led to cost and time over-runs on these projects, putting further stress on the
already stretched balance sheets.
•Investments in management processes, systems and people capabilities have not kept
pace with the investments in assets and the changing market place. This is increasingly
becoming a bottleneck for growth.
Key Capabilities to become game
changers


Resource acquisition, development and operations

The pursuit of raw material security has led Indian steel companies to seek mining leases and
assets globally. The capability to acquire, develop and operate these assets has become a
key strategic imperative. These assets provide a natural hedge at the raw material portfolio
level, and are also important for overcoming the short-term domestic challenges.


Efficient capital project management

TheIndian steel companies are increasingly undertaking larger, more complex and riskier
projects to meet their capacity goals. Their ability to successfully execute these projects is
hindered by regulatory challenges, limited talent pools, contractors and construction labour
constraints, increasing infrastructure requirements, and expectations of compliance with
superior safety and environmental norms. Capital investments have not been accompanied
by a commensurate investment in enhancing capability to plan and execute these projects.

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

Customer-Centric Sales and Marketing

As Indian steel companies expand, they are increasingly facing an overlap in their market
and product footprint. This coupled with a lower demand growth has led to increased price
competition and pressure on margins. In this scenario, increased customer centricity will
differentiate the high performers.


Differentiated Supply Chains

Global trends are driving increased product and distribution complexity, as diverse and
digitally-empowered customers demand ever-more tailored products and services. To
remain competitive, companies across industries must embrace this growing complexity
while maintaining the benefits of simple, streamlined supply chains to deliver their aspirations
of growth, cost, working capital and sustainability.


Human capital management

India steel companies’ ability to manage and leverage its human capital will become a key
differentiator and will play a key role in enabling their growth aspirations. We believe Indian
steel companies will need to address the 4 D’s of managing talent.
Define Discover Develop Deploy

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Current state of Indian Steel Industry


The Indian steel industry has entered into a new era of development since 2007-08, riding high
on the resurgent economy and robust demand for steel. Rapid rise in production has resulted in
India becoming the 4th largest producer of crude steel and the largest producer of sponge iron
in the world.



Domestic steel demand to remain muted during FY2012–17 on account of a weak macro
economic environment The demand for longs is expected to increase by 19 million ton (MT) at
a CAGR of 9 percent and for flats by 16 MT at a CAGR of 8 percent between FY2012 and
FY2017 . This is due to relatively weaker growth prospects of flats end-user industries (such as
automotive and consumer durables) than those for longs.



Increased domestic competition Incumbents and challengers have announced 71 million ton
per annum (MTPA) of steel capacity addition between FY2012 and FY2017 through both
brownfield and greenfield routes. However, there is considerable uncertainty on the actual
capacity addition as many projects are yet to achieve financial closure due to delays or lack of
regulatory clearances.
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Based on our bottom-up assessment of the announced capacity additions,
projects aggregating to 35 MTPA of crude steel capacity have already achieved
financial closure. Hence, we expect a minimum aggregate capacity of 122 MTPA
to be commissioned by FY2017.
This capacity addition will lead to two structural changes. First, the concentration in
the longs segment will increase by 5–7 percent in the medium term, deepening the
sustainability challenge for secondary producers. Second, it will shift the current flatslongs capacity split of 50:50 to 60:40 by FY2017, if all the announced projects are
commissioned. As a result, one can expect oversupply in flats and a capacity shortfall
in longs.
Major steel producing countries 2012:
China (716.5mt)
Japan (107.2mt)
United States (88.7mt)
India (77.6mt)
Russia (70.4mt)
Major Exporter of steel according to 2012:
China (54.8mt)
European Union (47.1mt)
Japan (41.5mt)
Russia (26.7mt)
India 17th place (8.2mt)
Major Importer of steel according to 2012:
United States (31.5mt)
European Union (29.5mt)
Germany (22.9mt)
South Korea (20.4mt)
India 13th place (9.3mt)
List of Top Steel Companies in India:
TATA steel (20%) - Mumbai
SAIL (10%)- New Delhi
JSW steel (8%)- Mumbai
Visa steel (5%)- Jaipur
Bhushan steel (3%)- New Delhi
Market share of steel by countries in 2012
50

45.5
45
40
35
30

23.6

25
20
15
10

7

5.6

5

4.7

4.5

4.5

2.3

2.3

Ukraine

Brazil

0
China
1/17/2014 11:29:08 AM

Japan

US

India

Russia

Prepared by Gsdhir

South
Korea

ROW
10
•

Steel production in India has increased at a CAGR of 7.7 per cent over 2005–12. The
country is slated to become the second-largest steel producer by 2015 as large public and
private sector players strengthen steel production capacity in view of rising demand

•

Huge scope for growth is offered by India‟s comparatively low per capita steel
consumption and the expected rise in consumption due to increased infrastructure
construction and the thriving automobile and railways sectors

Technological
advancements

•

Increased government and corporate sector focus on using innovative production
techniques for enhancing operational as well as financial performance is a positive

Rising domestic and
international
investments

•

Domestic players‟ investments in expanding and upgrading manufacturing facilities are
expected to reduce reliance on imports. In addition, the entry of international players*
would provide benefits in terms of capital resources, technical know-how and more
competitive industry dynamics

Fourth-largest producer
of crude steel

Strong growth
opportunities

Notes: * - Arcelor Mittal and POSCO
1993–2012
1973–1992
1954–1964

•

1923–1948
•
•

1907–1918
•

•

•

•

Production of
steel started in
India (TISCO
was setup in
1907)
IISC was set up
in 1918 to
compete with
TISCO

Mysore Iron and
Steel Company
was set up in 1923
According to the
new Industrial
Policy Statement
(1948), new
ventures were only
undertaken by the
central government

•

•

Hindustan Steel Ltd
and Bokaro Steel Ltd
were setup in 1954
and 1964,
respectively
In the early 1990s,
the public sector
dominated steel
production
Private players were
in downstream
production mainly
producing finished
steel using crude
steel products

•

•

SAIL was created
in 1973 as a
holding company
to oversee most
of India's iron and
steel production
In 1989, SAIL
acquired
Vivesvata Iron
and Steel Ltd
In 1993, the
government set
plans in motion to
partially privatise
SAIL

•

•

•
•

Foreign players
began entering the
Indian steel market
No license
requirement for
capacity creation
Imposition of export
duty on iron ore, to
focus more on
catering growing
domestic demand
Decontrol of domestic
steel prices
Launch of Scheme for
promotion of
Research and
Development in Iron
& Steel sector

Notes: TISCO - Tata Iron and Steel Company; IISC - Indian Iron & Steel Company; SAIL - Steel Authority of India Ltd
Steel

Form

Liquid steel

Composition

Crude steel

Finished steel

End use

Non-alloy
steel

Alloy

Structural
steel

Stainless

Ingots

Semis

Low carbon
steel

Construction
steel

Silicon
electrical

Medium
carbon steel

Rail steel

Flat

Non-flat

High speed

High carbon
steel

Source: Report on Indian steel
industry by Competition Commission
of India, Aranca Research
Total crude steel production rose at a CAGR of 6.6 per cent over FY08–11 to 69.6 MT; production in the first nine months
of FY12 was a little more than three-fourth of FY11 levels
Finished steel production stood at 66.0 MT in FY11, recording a CAGR of 4.2 per cent during FY08–11; analysts expect
production figures to improve rapidly over the next five years with the Ministry of Steel forecasting production levels at
115.3 MT by FY17

T
otal crude steel production (million tonnes)

T
otal finished steel production (million tonnes)

52.9
52.6

47.6
42.6

49.1

44.5
43.4

42.1
36.8

17.1
FY08

41.1

16.4
FY09

16.7
FY10

Public sector

17.0
FY11*
Private sector

12.3
FY12* (April Dec)

13.5

12.7

13.0

13.1
8.6

FY08

FY09

FY10

Public sector

FY11*
Private sector

FY12* (April Dec)

Source: Ministry of Steel, Aranca Research;
Notes: FY - Indian Financial Year (April – March); MT - Million Tonnes, * - Provisional; CAGR - Compound Annual Growth Rate
SAIL is the leading player in India‟s steel sector; in the first nine months of FY12, the company accounted for 18.7 per cent
of the country‟s crude steel production and had a 13.5 per cent share in finished steel production
Tata Steel, another household name in the country, leads private sector activity in the steel sector; during April– December
2011, the firm accounted for 9.9 per cent of crude steel production and 7.8 per cent of finished steel production

India crude steel market share by production - FY12* (Apr-Dec)

9.9%

India finished steel market share by production
- FY12* (Apr-Dec)

7.8%

Tata Steel

Tata Steel
13.5%

18.7%

SAIL

SAIL
4.0%

4.3%

RINL

RINL

67.1%
Other

74.7%

Other

Source: Ministry of Steel, Aranca Research;
Notes: RINL - Rashtriya Ispat Nigam Limited, * - Provisional
Market value of the Indian steel sector
(USD billion)

In 2011, the Indian steel sector‟s total market value was
USD57.8 billion
The sector has benefitted from rises in price and

CAGR: 17.7%

millennium

46.8
43.0

Over 2007–11, the sector‟s market value is estimated to
have posted a strong CAGR of 17.7 per cent

36.5
30.1

2007

2008

2009

2010

2011

Source: Datamonitor, Aranca Research
Note: E - Estimates
Consumption of steel (in million tonnes)

Total consumption of steel exceeded production and grew
to 70.9 MT in FY12 as against 66.4 MT in FY11; over
cent

CAGR: 8.7%

66.4

70.9

59.3

Driven by rising infrastructure development and growing
demand for automotives, steel consumption is expected to
grow at an average rate of 6.8 per cent, reaching 104 MT by
2017

52.1

51.9

FY08

FY09

46.8

FY07

FY10

FY11

FY12*

Source: Ministry of Steel, Indian Steel Markets Conference,
Datamonitor, BMI, Aranca Research
Notes: FY12* - Data for FY12 is provisional, MT - Million Tonnes
With steel‟s demand growth outpacing growth in domestic production over the last few years, import dependency has
increased
Imports have increased at a CAGR of 6.8 per cent over FY07–12
In FY12, total imports stood at about 6.8 MT

Steel demand and production (in million tonnes)

67
55 53

55 55

64

Steel exports and imports (in million tonnes)
7.4

7.0

71 69

6.8

6.8

60 57

5.8

50 50

4.9 5.2

5.1

4.4
3.5

4.0

3.3

2007

2008

2009
Demand

2010
Production

2011

2012

FY07

FY08

FY09

FY10

Imports

FY11

FY12*

Exports

Source: Ministry of Steel, JSPL presentation, Aranca Research
Notes: FY - Indian Financial Year (April - March), * - Data for FY12 is provisional
Infrastructure is India‟s largest steel consumer, accounting
for 63 per cent of total consumption in FY11

Sector-wise steel consumption FY12
2%
3%
0

This is not surprising given the heavy use of steel in
this sector and soaring construction and
infrastructure activity in the country over the past
decade
Engineering and fabrication is the next largest consumer,
with 22 per cent of total consumption

Infrastructure

10%
Engineering and
fabrication
Autos
22%
63%

Packaging

Transportation

Source: JSPL May 2013 presentation, Aranca Research
Company

Products

Tata Steel Ltd

Finished steel (non-alloy steel)

SAIL

Finished steel (non-alloy steel)

JSW Steel Ltd

Hot-rolled coils, strips and sheets

Jindal Steel & Power Ltd

Iron and steel

Ispat Industries Ltd

Hot-rolled coils, strips and sheets

Welspun-Gujarat Stahl Rohren Ltd

Tubes and pipes

Bhushan Steel Ltd

Cold-rolled coils, strips and sheets

Source: Aranca Research
•

Growing investments

SAIL has modernised and expanded its integrated steel plants in Bhilai, Bokaro, Rourkela,
Durgapur, Burnpur and Salem
• The company is in the process of expanding its crude steel production capacity to 21.4
MTPA by 2013
• Completed mega expansion of Rashtriya Ispat Nigam Limited (RINL) to more than double
capacity of plant (from 2.9 MT to 6.3 MT) from 2013-14
•

Strategic alliances

International Coal Ventures Pvt Ltd, comprising SAIL, RINL, CIL, NTPC and NMDC, has
been set up for acquisition of coal mines overseas
• The consortium of SAIL and National Fertiliser Limited (NFL) has been nominated for
revival of Sindri Unit of the Fertiliser Corporation of India Limited
• RINL, Vishakhapatnam Steel Plant and the Power Grid Corporation of India Ltd
(POWERGRID) signed an MoU to set up a joint venture company to manufacture
transmission line towers and tower parts including R&D of new high-end products
•

Entry of international
companies

Attracted by the growth potential of the Indian steel industry, several global steel players
have been planning to enter the market
• National Mineral Development Corporation (NMDC) has signed an MoU with Russia‟s
third-largest steelmaker, Severstal, for a greenfield steel plant in Karnataka
• Posco Steel to invest USD12 billion in setting up a 12 MT project in India
Source: Ministry of Railways, Aranca Research
Notes: MOUs - Memorandum of Understanding, MT - Million Tonnes
•

Increased emphasis on
technological
innovations

Indian steel companies have now started benchmarking their facilities and processes
against global standards, to enhance productivity
• These steps are expected to help Indian companies improve raw material and energy
consumption as well as improve compliance with environmental and pollution yardsticks
• Companies are attempting coal gasification and gas-based direct-reduced iron (DRI)
production. Other alternative technologies such as Hlsmelt, Finex and ITmk3 being
adopted to produce hot metal
Source: Aranca Research
Steel integrated plants under
SAIL (Bhilai, Rourkela,
Bokaro, Durgapur and
Burnpur)

Tata Steel‟s largest steel
plant, based in Jamshedpur

Alloy and special steel
plants under SAIL
(Bhadrawati and Salem)

RINL steel plant in
Vishakhapatnam

Source: Company websites, Aranca Research
Growing demand

Policy support

Growing demand in
the construction
industry

Increasing investments

Rising investments
from domestic and
foreign players

100 per cent FDI in
the steel sector
Inviting

Resulting in

Growing demand in
the automotives
sector

Encouragement of
sector-based R&D
activities by the
government

Increasing number
of MoUs signed to
boost investment in
steel

Rising demand for
consumer durables
and capital goods

Reduced custom
duty and other
favourable
measures

Foreign investment
of nearly USD40
billion committed in
the steel sector

Note: FDI - Foreign Direct Investment
Investment in infrastructure by the Planning Commission is
expected to expand at a CAGR of 14.5 per cent over FY12–
17

Projected values of investment in infrastructure
(USD billion)

191.4

investment to be USD1 trillion in the 12th Five-Year Plan
(2012–17), from USD428 billion in the 11th Plan
This increase in infrastructure investment is set to raise
steel demand by roughly 40 MTPA during FY13–17

CAGR: 14.5%

169.0
149.1

114.1

131.2

FY13

FY14

97.3

FY12

FY15

FY16

FY17

Source: Planning Commission, Aranca Research
Notes: MTPA - Million Tonnes Per Annum
Over FY03-FY11, consumer durables has grown at a CAGR of 12.2 per cent as growth in disposable income resulted rise
in their demand
Capital goods and consumer durables are expected to grow at a 7.5 per cent to 8.8 per cent over 2012-2021
Automotives production expanded at a CAGR of 22.2 per cent over FY09–12
Commercial vehicles are the fastest growing segment with a CAGR of 29.8 per cent over the same period
Over FY12-FY21, the automotive sector is projected to grow at a CAGR of 11.5 per cent to 12.5 per cent

Consumer durables market size (USD billion)

30.2

T
otal production of automobiles in India
(million units)
7.3

FY04

FY05

FY06

FY07

FY08

FY09

FY10

FY11

14.2

5.1

9.7

Passenger vehicles
Three wheelers & two wheelers

FY12

2.4

FY11

3.1
0.9

3.0
0.8

2.4
0.6
FY10

1.4

FY09
FY03

11.1

4.2
8.9

3.2

3.8

1.8
0.4

2.9

3.5

16.3

5.2
4.7

21.0

6.3

CAGR: 12.2%

FY16E

FY21E

Commercial vehicles

Source: SIAM, JSPL May 2013 presentation, Corporate Catalyst India, Aranca Research
Notes: E - Estimate; FY - Indian Financial Year (April - March)
•

National Steel Policy
2012

In view of the sector‟s changed dynamics, globally as well as domestically, the Ministry of
Steel has initiated the process of drafting a new National Steel Policy to replace the
existing National Steel Policy of 2005
• The government has set up a committee headed by the Steel Secretary to monitor the
formulation of the new National Steel Policy
• Four task forces have been constituted to study, analyses, consult and formulate draft
policy documents on different aspects of the policy
• The current policy draft proposes allotment of captive iron ore mines to producers through
open bidding and putting some mines in the general category
A new scheme, „The scheme for the promotion of R&D in the iron and steel sector‟, has
been approved with budgetary provision of USD24.6 million to initiate and implement the
provisions of the scheme as per the 11th Five-Year Plan
• USD10.7 million had been spent under the scheme up to December 2012
• The development of technology for cold-rolled grain oriented (CRGO) steel sheets and
other value-added products is also included under the policy purview and is allocated
USD6.7 million
•

R&D and innovation

Source: Ministry of Steel, Aranca Research
Foreign Direct
Investment

Rise in export duty on
iron ore

•

100 per cent FDI through the automatic route is allowed in the Indian steel sector

•

The government hiked the export duty on iron ore to 30 per cent ad valorem on all
varieties of iron ore* (except pellets)

Source: Ministry of Steel, Aranca Research
Notes: * - w.e.f. 30th December 2011
•

Export duty on iron ore has been increased to 30
per cent ad valorem on all varieties of iron ore
(except pellets), to preserve iron ore resources for
domestic use

•

As per the government‟s decision, the Government
of India‟s 51 per cent shareholding in Eastern
Investments Company Limited (EIL), under Bird
Group of Companies, was transferred to RINL

•

•

New Research and Development policy for the
steel sector have been finalised/adopted for
implementation
New techno-economic benchmarks have been
evolved on international patterns to improve
performance of steel PSUs; implementation is
being monitored closely

•

Under the Ministry, the Joint Plant Committee
(JPC) studied 300 districts, 1,500 villages, 4,500
manufactures and 8,000 retailers spread over
India‟s 28 states and 7 union territories to assess
steel demand in the rural areas and examine the
potential to increase steel consumption levels

•

The Ministry of Steel set up the Steel Innovation
Council to promote innovative ideas in the steel
sector

•

The New National Steel Policy for the forthcoming
years is under finalisation

•

In April 2013, the Ministry of Steel signed a Letter
of Intent (LoI) with the Tanzanian Government to
strengthen cooperation in steel and mining
activities

Source: Ministry of Steel, Aranca Research
Notes: W.E.F - With Effect From 30th December, 2011
Developer

Location

Product

Viraj Profiles Ltd

Thane, Maharashtra

Stainless steel engineering
products

Jindal Steel Ltd

Kalinganagar

Stainless steel

Salem, Tamil Nadu

Steel

Jajpur, Orissa

Metallurgical-based engineering
and ancillary/downstream industry

SAIL Salem SEZ Pvt Ltd

Orissa Industrial Infrastructure
Development Corporation

Source: Formal approvals granted in the Board of Approvals after the SEZ rules coming into force,”
Special Economic Zones in India website, www.sezindia.nic.in
M&A scenario – details
Period: 1 January 2012 to 21 June 2013
Deal type

Number of deals

Largest deal (USD million)

Inbound

2

-

Outbound

1

-

Domestic

3

232.6

Cumulative FDI inflows
Period: April 2000 to March 2013
Sector
Metallurgical industries

USD7.5 billion

Per cent of total FDI
inflow

3.9

Source: Thomson ONE Banker, “Fact Sheet On Foreign Direct Investment (FDI)”, Department of Industrial Policy and Promotion
State

MoUs signed (2011)

Capacity addition (MTPA)

Orissa

63

81.2

Jharkhand

49

105.1

Chhattisgarh

76

60.0

West Bengal

16

39.4

Karnataka

57

173.0

Andhra Pradesh

18

11.8

Other states

22

18.2*

301

488.6

Total

Capacity addition plans 2012
Company

Plans

SAIL

SAIL plans to invest USD27.3 billion in increasing capacity from 21.4 MTPA to 45 MTPA. In
its recent expansion plan, the company modernised and expanded its integrated steel
plants at Bhilai, Bokaro, Rourkela, Durgapur, Burnpur and a special plant at Salem

NMDC

NMDC is setting up a greenfield integrated steel plant of 3 MTPA capacity in Nagarnar,
Chhattisgarh at an estimated cost of about USD3.2 billion
Source: Ministry of Steel, Annual Report 2011-12; Note: MTPA - Million Tonnes Per Annum, * - Estimated figures
Jindal Steel and Power Limited
Incorporated in 1979, Jindal Steel and Power Limited (JSPL)
is an integrated steel producer and the largest coal-based
sponge iron manufacturer in the world. The company has an
installed steel production capacity of 3 MTPA. JSPL is
engaged in manufacturing long products and is specialised
in producing long rails for railways and large sized H-beams
as well as columns for the infrastructure and construction
sector

Projected crude steel capacity in the 12th Plan
(million tonnes)

11.5
10.0
8.0

CAGR: 25.1%

7.0

4.5
3.0

3.0

JSPL also has significant presence across the mining, power
generation and infrastructure sectors
•

Achievements:
•

•

2011 – Ranked third in the Metals category of
Business World‟s Most Respected Companies
Survey, 2011
2010 – Rated the World‟s Second-Largest Value
Creator by the Boston Consulting Group (BCG)
and the World‟s Largest Value Creator in the
Mining and Materials category

FY11

FY12

FY13

FY14

FY15

FY16

FY17

Source: Company website (www.jindalsteelpower.com),
Planning Commission, Aranca Research
Financial growth (USD million)

Sale of steel (million tonnes)

3,315
3.8

2.8
2.0

0.8
0.3 0.5

FY06

0.7

2.8
1.9

1.2

1.0

671

0.2
FY07

2,287
1,803

1.6

1.6

1.4

2.3

3,007

103
FY8

Finished steel products

FY9

FY10

FY11

Semi steel products

FY12
Pellets

FY06

816
197

FY07

818
431

FY08

438

721

395

FY09
FY10
FY11
Gross revenue
PBIDT

FY12

FY13

Source: Company website (www.jindalsteelpower.com)
Notes: Company clubs iron and steel segment „s performance; PBIDT (Profit Before Interest, Depreciation and Tax)
Strong diversified
customer base of
2,758 customers

TMT Re-bars
Expansion in
international
markets

Wire rods

Foray into the oil &
gas and cement
sectors as a part of
diversification

FY 13–14
Steel capacity to
rise from
3.5MTPA to
7.0MTPA

Plate and coils
Organic growth
through capacity
additions

Column sections

FY08
ISO
9001:2008
accreditation

Hot-rolled parallel
flange beams

The iron and steel
segment continues
to be a major
contributor (~75%)

1991
Commenced
operations

Long track rails
1991

1993

1995

1997

1999

2002

2006

2010

2012
Bhushan Steel Limited

Projected crude steel capacity in the 12th Plan
(million tonnes)

Established in 1983, Bhushan Steel Limited (BSL) is the
third-largest secondary steel producer in India. The company
has an existing steel production capacity of 2.5 MTPA. It
primarily manufactures flat steel products for the automobile
industry
Products – Cold-rolled closed annealed coils, galvanised
coils and sheets, high tensile steel strapping, colour coated
coils, galume sheets and coils, hardened and tempered steel
strips, billets, sponge iron, precision tubes and wire rods
•

5.0

5.0

5.0

5.0

FY14

FY15

FY16

FY17

4.5

2.2

2.5

Milestones:
•

2004 – Commissioned secondary steel production at
Khapoli, Maharashtra

•

2006 – Commissioned primary steel production at
Meramandali, Odisha

•

2006 – Commissioned secondary steel production at
Sahibabad, Uttar Pradesh

FY11

FY12

FY13

Source: Company website (www.bhushansteel.com),
Planning Commission, Aranca Research
Financial growth (USD million)

Production of steel (million tonnes)

2,251
2.1
1,662

1.8
1.6
1.2

1,161

1,178

1.0

1,266

11
6

17
8

1.1
928

1,541

10
5

693
35
FY06
FY07

FY08

FY09

FY10

FY11

FY12

69
FY07

92
FY08

FY09

Gross revenue

221
FY10

FY11

213
FY12

9MFY13

NPAT

Source: Company website (www.bhushansteel.com), Aranca Research
Notes: NPAT - Net Profit After Tax
Technological
upgradation and
further capacity
addition

Other
developed products
Capacity
expansion
(0.9 MT to 2.5 MT)

S on kin ron
Ironpmage ig and
castings
Partnership with
Japanese steel
producer,
Sumitomo

Alloy billets
Alloy steel

Color coated tiles
Wheel, pipes
and tyre and

FY06
Primary steel
production in
Odisha

Organic growth in
steel and flat
products

axle plant (railways)
Galvanised

FY12
USD2.5 billion
turnover

1989
Secondary
steel
production in
UP

Strong diversified
customer base of
3,300 customers

Cold-rolled
1989

1991

1993

1995

1997

1999

2002

2006

2010

2012
T Steel Limited
ata

Projected crude steel capacity in the 12th Plan
(million tonnes)

Established in 1907 by the visionary founder – JN Tata, Tata
Steel is among the top ten global steel companies with an
annual crude steel capacity of over 28 MTPA

20.0
17.5

The company caters to sectors such as automotive,
construction, consumer goods, engineering, packaging,
energy & power, ship building, rail and defense & security
•

Milestones:
•

2007 – Tata Steel and Corus were integrated at
USD12 billion, making Tata Steel one of the top ten
global steel producers

11.0
9.2
6.8

7.6

2009 – Tata Ryerson and HMPCL merge with Tata
Steel

•

CAGR: 19.7%

15.1

FY11

FY12

FY13

FY14

FY15

FY16

FY17

Source: Company website (www.tatasteel.com),
Planning Commission, Aranca Research
Financial growth (USD million)

Production and sales of steel division (million tonnes)
7.9 7.5
6.7 6.4 7.0 6.6

6.4

7.1

7.2
5.9

5.6

5.8

6.2
4.9 4.8 4.9 4.8 5.4
4.6 4.4

4.5

5.2
3.9

0.8

FY06

FY07

FY08

FY09

FY10

Production

FY11

Sales

FY12

FY13

FY06

0.9

FY07

1.2

1.1

1.1

FY08

FY09

NPAT

FY10

1.5

1.4

FY11

FY12

Gross revenue

Source: Company website (www.tatasteel.com), Aranca Research
Notes: NPAT - Net Profit After Tax
Developed products
Technological
upgradation
Iron making and

Capacity
expansion
(3 MT)

castings

Diversification
(coal injection
unit)

Alloy steel

Wheel, tyre and
axle plant (railways)

Pig iron and
steel ingots

FY13
USD7.0
billion
turnover*
M&A
(Tata-Corus)

Organic growth in
steel

1912
Production
capacity (1.6
lakh tonnes)

FY06
USD3,625
million
turnover

Announced plans
to merge Tata
Metaliks Ltd and
Tata Metaliks
Kuboto Pipes Ltd
with itself in April
2013

Blast furnace
1912 1995 1996 1997 1998 1999 2000 2002 2004 2006 2008 2010 2011 2012 2013
Source: Company website (www.tatasteel.com), Aranca Research, * - Revenues from Indian operations
Note: M&A - Mergers and Acquisitions
JSW Steel

Projected crude steel capacity in the 12th Plan
(million tonnes)

Established in 1994, JSW Steel Ltd manufactures iron and
steel products in India and abroad

Products – Hot-rolled coils, plates and sheets; cold-rolled
coils and sheets; galvanised sheets and coils; pre-painted
galvanised coils, sheets and galvanised sheets
•

17.6

CAGR: 8.8%
13.23

14.3

14.3

14.3

FY13

FY14

FY15

18.4

11.1

Achievements:
•

2011 – National Sustainability Award by the Indian
Institute of Metals

•

2009 – Gold Award in the Metal and Mining sector

•

2008 – National Energy Management Award
instituted by CII

FY11

FY12

FY16

FY17

Source: Company website (www.jsw.in),
Planning Commission, Aranca Research
Financial growth (USD million)

Product group-wise sales (million tonnes)

7,221

6.9

7,137

5.9
5,228

4.7
4,053
3,162

2,631
1.5 1.71

1,417

1,937

1.1
0.3 0.4 0.3
Semis

178
Rolled Flats
FY11

FY12

Rolled Longs

FY13

FY06

269
FY07

360
FY08

421

96
FY09

FY10

Gross revenue

419
FY11

339
FY12

332
FY13

NPAT

Source: Company website (www.jsw.in)
Hot-rolled
Capacity
addition 7.8 MT

Cold-rolled

JV formed to
explore, develop &
mine iron ore with
MML

Wire rods

TMT Re-bars

Organic growth
and integration
1994
ISO
accreditations

Galvanised
product

Special steel bars

FY06
USD1,417
million
turnover

1994
Production
capacity
(1.25 MTPA)

FY 13
USD7.1
billion
turnover

FY 14
Saleablesteel
sales to rea h
c
9.75 million
tonnes

1994 1995 1996 1997 1998 1999 2000 2002 2004 2006 2008 2010 2011 2012 2013
Notes: JV - Joint Venture, TMT - Thermo Mechanically Treated, MML - Mysore Minerals Limited, MTPA - Million Tonnes Per Annum
Automotive
• The

automotives
industry is forecasted
to grow in size by
USD122–159 billion
by 2016

Capital goods
•

• With

increasing
capacity addition in
the
automotive
industry, demand for
steel from the sector
is expected to be
robust

•

Infrastructure

The capital goods
sector accounts for
11 per cent of steel
consumption,
and
has the potential to
increase in tonnage
and market share

• The government aims

Corporate
India‟s
capex is expected to
grow and generate
greater demand for
steel

• Due to such a huge

to
increase
infrastructure
spending from 8.4
per cent of GDP in
FY11 to 10.7 per cent
by FY17

investment
in
infrastructure
the
demand for long steel
products
would
increase in the years
ahead

Airports
• More

and
more
modern and private
airports are expected
to be set up

• Development of Tier-

II city airports would
sustain consumption
growth
• Estimated

steel
consumption
in
airport building is
likely to grow more
than 20 per cent over
next few years

Note: Capex – Capital Expenditure
Railways
• The

dedicated rail
freight
corridor
network
(DRFC)
expansion would be
enhanced in future

• Gauge

conversion,
setting up of new lines
and
electrification
would
drive
steel
demand

Oil and gas

Power

Rural India

liquid
fuel
transportation pipeline
network is likely to
grow from the present
16,800 km to 22,000
km in 2014

• The government aims

• This would lead to an

• Both generation and

increase in demand of
steel tubes and pipes,
providing a lucrative
opportunity to the
steel industry

transmission
capacities would be
enhanced,
thereby
raising steel demand
from the sector

• The

•

Rural
India,
accounting for 70 per
cent
of
Indian
population has low
steel
per
capita
which
consumption
provides huge scope
for growth

•

Policies like Bharat
Nirman and Rajiv
Gandhi Awaaz Yojna
are driving growing
demand
for
construction steel in
rural India

to
add
71,000–
1,07,500 MW (Mega
Watt)
of
capacity
during the 12th FiveYear Plan

Source: Planning Commission, Aranca Research
Current state of Global Steel Industry


1/17/2014 11:29:09 AM

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47
Steel Capacity Outgrows Demand Growth
 During 2000~2012, global crude steel capacity ∆ 1,013 Mt to reach
2,063 Mt, whereas crude steel production ∆ 683 MT to 1,532 Mt
 Chinese capacity ∆ 771Mt to 921 Mt, production ∆ 602 Mt to 731 Mt
 After the global economic crisis, capacity expansion momentum slows,
but the emerging economies continue to seek expansion
Steed Demand vs Capacity (2000=100)
Apparent steel use, crude steel equivalent

Capacity, crude steel

2000=100

220
200
180
160
140
120

1/17/2014 11:29:09 AM

Prepared by Gsdhir

2014

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

100

48
Return of Overcapacity
 While world steel demand continues to grow, capacity utilization ratio
trends down
 No easy solutions to overcapacity in sight

100%

World crude steel capacity utilisation

Jun-08
92.7%
90%

Apr-10
84.5%

Apr-11
83.4%
Sep-13
79.3%

80%

Aug-10
74.2%

70%

Dec-12
71.5%

60%

Dec-08
59.9%

1/17/2014 11:29:09 AM

Prepared by Gsdhir

Jul-13

Jan-13

Jul-12

Jan-12

Jul-11

Jan-11

Jul-10

Jan-10

Jul-09

Jan-09

Jul-08

Jan-08

50%

49
Raw Materials Side Adds to Adversity
 Value chain profits has been shifting away from the steel industry
 Volatility and uncertainty in raw materials prices since departure from
the benchmarking pricing system
value chain profit pool split evolution
100%=
Iron ore
Coking
coal

54
8
11

23

125

156

17
44

7

81

135

15
42
46

22
Steel
making
(HRC)

230

22
78

28

32

61
35

27
26

1995

2000

2005

10

2011

2017

Source: McKinsey & Company

1/17/2014 11:29:09 AM

Prepared by Gsdhir

50
Steel Industry Performances

Steel vs Raw materials prices
Index 2005=100

1/17/2014 11:29:09 AM

Steel industry stocks vs Dow Jones
Index 2005=100

Prepared by Gsdhir

51
Steel Demand Forecasts for 2013-14
Apparent Steel Use, finished steel (SRO October 2013)

Mt

y-o-y % growth

%

Mt

14.0

15

10

1 403
1 219

5

125.0*
1 523

1 400
1 200

1 300

1 219
1 141

7.0

1 430

1 475

1 600

7.9

1 000

3.1
0

3.3

2.0

800
600

0.0
400

-5

200

-6.4
-10

0
2007

2008

2009

2010

2011

2012

2013

2014

*) 2014 as % of 2007

1/17/2014 11:29:09 AM

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52
Demand Forecasts for selected countries
Apparent Steel Use, finished steel (SRO October 2013)
Mt

%

2012

2013

2014

12/11

13/12

14/13

2014 as %
of 2007

1,430.3

1,475.1

1,523.2

2.0

3.1

3.3

125.0

96.2

96.9

99.8

7.8

0.7

3.0

92.2

140.2

134.9

137.8

-9.5

-3.8

2.1

69.1

63.9

64.0

63.0

-0.2

0.1

-1.6

77.6

660.1

699.7

720.7

2.9

6.0

3.0

172.2

71.6

74.0

78.2

2.6

3.4

5.6

151.8

25.2

26.0

27.0

0.6

3.2

3.8

122.3

54.8

57.3

60.4

12.8

4.6

5.4

149.7

63.2

64.3

69.0

2.2

1.7

7.3

127.2

Developed Economies

390.2

384.1

390.5

-1.7

-1.6

1.7

82.4

Emerging & Developing
Economies excl China
World excl. China

380.0

391.4

412.1

4.2

3.0

5.3

126.0

770.2

775.4

802.6

1.1

0.7

3.5

100.3

World
United States
European Union (27)
Japan
China
India
Brazil
ASEAN (5)
MENA

1/17/2014 11:29:09 AM

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53
Key Trends in Post-Crisis Period Steel Demand
 Multi-speed recovery continues driven by emerging economies, but
weakening growth in the emerging world

 Eurozone stabilizes and finally positive growth expected in 2014
 China moves into slower growth phase
 Key emerging economies struggling with structural issues
Multi-Speed Recovery of Steel Demand
180
2007=100

World

China

Developed Economies

Em. & Dev Economies excl. China
.

160

140
120
100
80
60
2007

1/17/2014 11:29:09 AM

2008

2009

2010

201
1

Prepared by Gsdhir

2012

2013

2014

54
Regional Share in World Steel Demand
Apparent Steel Use, finished steel (SRO October 2013)
Emerging & Developing Economies

Developed Economies

China

2000
2001

41.5%

58.5%

16.4%

2002
2003

53.9%

20.5%

46.1%

2004
2005
2006

51.5%
23.3%

48.5%

2007
2008
2009

47.8%
27.4%

52.2%

2010
2011

47.0%
28.3%

53.0%

2012
2013
2014

41.7%
33.3%

33.1%

1/17/2014 11:29:09 AM

58.3%

58.4%
Prepared by Gsdhir

41.6%
11
55
China Entering a New Phase of Development
 After soft landing, renewed focus on rebalancing of the economy
 Less steel intensive growth to come, implying steel demand growth will
underperform GDP growth

 Future focus will be on capacity closures, environmental performance
and upgrading
Growth trend of China’s steel use

1/17/2014 11:29:09 AM

Steel intensity (ASU/GDP)

Prepared by Gsdhir

56
Economic Growth and Steel Demand
S-Curve of different countries
Thailand

China

Indonesia

United States

Japan

South Korea

India

Per Capita Steel Use
finished steel, kg, 2012

ASU per capita, ASU, crude steel equivalent per capita, kg

1 400

488 506

1 200

1 000

305

279

222

Japan

220

127

600

40

57

400
Africa

United States

India

200

Brazil

Middle United EU (27) China
East States

Japan

World

0
0

10

20

30

GDP per capita, 2005 PPP$,

1/17/2014 11:29:09 AM

40

50

thousands USD

Prepared by Gsdhir

57
How Far Will Chinese Steel Demand Grow?
Positive
Further room for urbanization and
Industrialization
Low level of development in the West

Negative
Condensed growth, high share of
investment in GDP
Environmental regulations, resource
constraints

Manufacturing relocation out of China
Speed and mode of development in the West
China provincial steel use per capita (2011, kg/per, crude steel equiv )

China (2012) US (1973)

1/17/2014 11:29:09 AM

Japan (1973)

Prepared by Gsdhir

58
End of the China Effect, Next Growth Engine?
Evolution of Steel Demand (1950-2014, crude steel equiv)
Mt
CAGR 2007-2014
3.1%

1 800
1 600

RoW

CAGR 2000-2007
6.6%

1 400
1 200

China

CAGR 1975-2000
1.1%

1 000

former USSR

CAGR 1950-1975
5.0%

800
600

US, EU, Japan

400
200

2010

2005

2000

1995

1990

1985

1980

1975

1970

1965

1960

1955

1950

0

Contribution to Apparent Steel Demand Growth( ∆ Mt)
World
Developed
China
Other Emerging
1992-2000

142.6

84.1

51.1

7.4

2000-2007

480.3

74.2

297.8

108.4

2007-2014

320.2

-85.5

314.8

90.9

1/17/2014 11:29:09 AM

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59
Developing World: Strong Fundamentals

Population
(million)

Urbanisation
(%)

GDP per capita,
(PPP$)

Steel Use/
capita(Kg)

2012
Mexico
Turkey
Brazil
Thailand
China
Indonesia
India
Vietnam

1/17/2014 11:29:09 AM

2020

2010

2020

2012

2020

2012

116

126

77.8

80.5

14.4

17.3

173

75

81

70.5

78.6

14.1

17.9

382

198

210

84.3

86.8

11.0

13.8

127

70

72

33.7

38.0

9.4

12.9

234

1 354

1 388

49.2

61.0

9.0

15.3

488

245

263

49.9

57.2

4.7

6.7

51

1 258

1 387

30.9

34.8

3.7

5.7

57

90

96

30.4

36.9

3.4

5.1

122

Prepared by Gsdhir

60
Environmental Challenges
 Energy use reduction efforts in developed world already at theoretical limit
and limited progress in Break-Through technologies. Pressure on costs
and also negative impact on steel demand growth

 However. steel has been successful in providing solutions to the
sustainability - lighter vehicles, renewable energy, etc …
Energy Intensity of steel production
(NAmerica+Japan +EU27)

1/17/2014 11:29:09 AM

Energy intensity of iron and steel
production (GJ/t of crude steel)

Prepared by Gsdhir

61
Steel as Solution to Sustainable Future
 Innovative use of steel saves six times as much CO2 as is caused by
the production of the steel → LCA approach
Case study

1
2
Energy
industry

3
4

Traffic
HH, ind.,
CTS1

5
6

Emissions in the
steel production3

Net CO2 reduction potential

Efficient fossil fuel PPs

29.5

Wind power plants

0.03

1.9

14 : 1

1.3 : 1

8.4

11.2
0.9

1.1 : 1

1.0

1.0

9:1

9.2

Combined heat/power
0

3:1

0.7

Weight reduction cars

7

~ 200 : 1

0.1

2.1

Weight reduction trucks

32 : 1

0.4

5.0

Other renewables2

Efficient e-motors

~ 400 : 1

<0.1

14.2

Efficient transformers

Ratio between CO2
reduction/emission4

5

10

30

0

Mt
8

1

9

10

11

Mt

6:1

1.HH = households; CTS = commerce, trade, and service 2. Geothermal, biomass, hydro 3. CO 2 expenditure for other materials not examined;
values are rounded 4. Ratio relates exclusively to the emissions
Source: BCG analysis

1/17/2014 11:29:09 AM

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62
Long Term View on Steel Demand
 Global steel demand could reach 2.2~3.0 billion in 2050
Long T
erm Evolution of World Steel Demand
Years
1970

589

1975

640

1980

713

1985

719

1990

773

1995

743

2000

846

2005

1 139

2010

Mt

Mt

1 404

2012

1 542

3 000

2 500
2 000
1 500
1 000
500
0
1870 1890 1910 1930 1950 1970 1990 2010 2030 2050

*apparent steel use, crude steel equivalent

1/17/2014 11:29:09 AM

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63
Conclusion
 Despite current difficulties, future scenarios for the steel industry have
optimistic starting point: Urbanization and population growth will support
industry growth for considerable time

 Surplus capacity in the industry will be difficult to reduce quickly, but can
be absorbed in long term

 Steel industry will continue to provide the basis for sustainability of the
modern society through innovation

 But the industry is facing formidable challenges ahead
 Changing position in value chain through expanding product mix,
development of new applications becomes crucial for steel industry

 Sustainable development and, in particular, Life Cycle Assessment
focus provides interesting challenges to the steel industry

1/17/2014 11:29:09 AM

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64
Technological Developments in Iron and
Steel Industry
Emerging Energy-efficiency and Carbon Dioxide Emissions-reduction technologies
for the Iron and Steel Industry


Iron and steel manufacturing is among the most energy-intensive industries and accounts for the largest share,
approximately 27 percent, of global carbon dioxide (CO2) emissions from the manufacturing sector. The ongoing
increase in world steel demand means that this industry’s energy use and CO2 emissions continue to grow, so there is
significant incentive to develop, commercialize and adopt emerging energy-efficiency and CO2 emissions-reduction
technologies for steel production. Although studies from around the world have identified a wide range of energyefficiency technologies applicable to the steel industry that have already been commercialized, information is limited
and/or scattered regarding emerging or advanced energy efficiency and low-carbon technologies that are not yet
commercialized. This report consolidates available information on 56 emerging iron and steel industry technologies,
with the intent of providing a well-structured database of information on these technologies for engineers, researchers,
investors, steel companies, policy makers, and other interested parties. For each technology included, we provide
information on energy savings and environmental and other benefits, costs, and commercialization status; we also
identify references for more information.
1/17/2014 11:29:09 AM

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65
Category of steel:
Carbon Steels- contain trace amounts of alloying elements and account for
90% of total steel production
Low Carbon Steels/Mild Steels contain up to 0.3% carbon
Medium Carbon Steels contain 0.3 – 0.6% carbon
High Carbon Steels contain more than 0.6% carbon
Alloy Steels- contain alloying elements (e.g. manganese,
silicon, nickel, titanium, copper, chromium and aluminum)
Stainless Steels- contain between 10-20% chromium
Tool Steels- contain tungsten, molybdenum, cobalt and vanadium in varying
quantities
No.

Report Section/Technology Name

Commercialization status

3.1. Emerging Agglomeration Technologies
1

3.1.1. Use of Biomass in the Sintering Process

Demonstration

3.2. Emerging Coke-making Technologies
2

3.2.1. Single-chamber-system Coking Reactors

Demonstration

3

3.2.2. Battery Under-firing with Advance Diagnostics and Control

Development

3.3. Emerging Technologies for Ironmaking Using Blast Furnace
4

Pilot

5

3.3.2. Blast Furnace Optimization by Using Computational Fluid Dynamics Modeling

Demonstration

6

3.3.3. Blast Furnace Optimization by Using X-ray Diffraction Analytical Technique

Demonstration

7

3.3.4. Blast Furnace Heat Recuperation

Demonstration

8

3.3.5. Plasma Blast Furnace

Development

9
10

3.3.1. Hot Oxygen Injection

3.3.6. Blast Furnace Slag Heat Recovery

Pilot/ Development

3.4.7. Charging Carbon Composite Agglomerates

Demonstration

3.4. Alternative Ironmaking Technologies
11

3.4.1. COREX® Process

Commercial with very low adoption rate

12

3.4.2. FINEX® Process

Commercial with very low adoption rate

13

3.4.3. Tecnored

Pilot

14

3.4.4. ITmk3 Ironmaking Process

Demonstration

15

3.4.5. Paired Straight Hearth Furnace

Development

16

3.4.6. Coal-Based HYL Process- A Syngas based DRI Plant

Commercial with very low adoption rate

17

3.4.7. Coal-Based MIDREX Process

Demonstration

18

3.4.8. Fine Ore Reduction in the Circulating Fluidized Bed (Circored® and Circofer®)

Demonstration/Pilot

19

3.4.9. Cyclone Converter Furnace

Pilot

20

3.4.10. Producing Iron by Electrolysis of Iron Ore (Molten Oxide Electrolysis)

Research/Development

21

3.4.11. Suspension Hydrogen Reduction of Iron Oxide Concentrate

Research/Development

22

3.4.12. Ironmaking using Biomass and Waste Oxides

Research

3.5. Emerging Technologies for Steelmaking Shops
23

3.5.1. Sensible Heat Recovery from Electric Arc Furnace Off Gases

Commercial with very low adoption rate/ Pilot

24

3.5.2. Electrochemical Removal of Zinc from Steel Scrap

Demonstration

25

3.5.3. Continuous Horizontal Sidewall Scrap Charging

Pilot

26

3.5.4. New Scrap-Based Steelmaking Process Predominantly Using Primary Energy

Development

27

3.5.5. ECOARCTM

Demonstration

28

3.5.6. Optimization of Basic Oxygen Furnace and Electric Arc Furnace Post Combustion Using Computational Fluid Dynamics Modeling

Pilot

29

3.5.7. Improving the Energy Efficiency of Electric Arc Furnaces through Laser-

Pilot

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3

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No.
30
31
32
33
34
35

Report Section/Technology Name
based Optimization of Post Combustion
3.5.8. Model-based Steel Temperature Measurement for Electric Arc Furnaces
3.5.9. In-Situ Real-Time Measurement of Melt Constituents
3.9.10. Injection of plastic waste in Blast Furnaces
3.9.11. Injection of Plastic Waste in the Electric Arc Furnace
3.9.12. Use of Waste Tires in EAF

Commercialization status
Development
Development
Demonstration
Pilot
Commercial with very low adoption rate

3.6.4. Continuous Steelmaking for Electric Arc Furnace
3.6. Emerging Casting Technologies
3.6.1. Near-net-shape Casting/Strip Casting

Research

37

3.6.2. Continuous Temperature Monitoring and Control in Continuous Casting
3.7. Emerging Rolling and Finishing Technologies

Development

38

3.7.1. High-Temperature Membrane Module for Oxygen Enrichment of Combustion Air for Fuel-Fired Industrial Furnaces

Pilot

39
40
41

3.7.2. Next-generation System for Scale-Free Steel Reheating
3.7.3. Thermochemical Recuperation for Steel Reheating Furnaces
3.7.4. Hot Strip Mill Model

Research
Research
Commercial with very low adoption rate

42

3.7.5. Innovative Reheating Furnace Management Using a Continuous Burn-Out Measuring System

Pilot

43
44

3.7.6. Oxygen-rich Furnace System for reduced CO2 and NOx emissions
3.6.2. HotEye® Steel Surface Inspection System

Development
Commercial with very low adoption rate/
Development

45

3.7.7. NOx Emission Reduction by Oscillating Combustion
3.8. Emerging Recycling and Waste Reduction Technologies
3.8.1. Recycling Basic Oxygen Furnace Slag
3.8.2. Rotary Hearth Furnace Dust Recycling System
3.8.3. Recycling of Stainless Steel Dust by Injection into Electric Arc Furnace
3.8.4. Regeneration of Hydrochloric Acid Pickling Liquor
3.8.5. Recycling of Waste Oxides in Steelmaking Furnace

Pilot

36

46
47
48
49
50

Commercial with very low adoption rate

Development
Demonstration
Pilot
Pilot
Pilot

3.9. Carbon Capture and Storage Technologies for the Iron and Steel industry
51
52
53
54
55

3.9.1. Top-gas Recycling in Blast Furnaces with Carbon Capture and Storage
3.9.2. Advanced Direct Reduction with Carbon Capture and Storage (ULCORED)
3.9.3. HIsarna with Carbon Capture and Storage
3.9.4. Post-combustion Carbon Capture Using Chemical Absorption Technologies
3.9.5. Geological Sequestration of Carbon Dioxide Using Basic Oxygen Furnace and Electric Arc Furnace Slag

Pilot
Development
Pilot
Development
Research

56

3.9.6. Integrating Steel Production with Mineral Sequestration

Research

1/17/2014
11:29:09 AM

4

Prepared by Gsdhir
THANK YOU

1/17/2014 11:29:09 AM

Prepared by Gsdhir

69

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Challenges & future scenario of steel industry 1

  • 1. Challenges & Future Scenario of Steel Industry PRESENTED BY : GS DHIR
  • 2. Executive Summary  Globally, steel players have been operating in a challenging environment with rising input costs and persistent lower capacity utilization. This is driven by Low demand growth in developed markets, accompanied by a structural shift in the global steel industry to developing countries like China and India.  Over the last decade, Indian steel companies have consistently achieved higher earnings before interest depreciation taxes and amortization (EBIDTA) margins as compared to their global peers and have delivered steady growth despite external challenges.  Having established quality assets, Indian steel companies are now well poised to take advantage of expansion and growth opportunities in India. However, six long-term challenges are confronting the Indian steel industry’s growth aspirations 1/17/2014 11:29:07 AM Prepared by Gsdhir 2
  • 3. •Volatile domestic iron ore supply is forcing Indian steel companies to pay higher prices or import this key raw material thereby exposing them to global iron ore price volatility. •Flat products supply will exceed demand, leading to an overcapacity situation. This coupled with the muted demand growth will put significant pressure on margins. • Customers are maturing and increasingly demanding value-added products and services. •Existing supply chains are stretched in order to cope with the wide range of customers and product specifications— original equipment manufacturers (OEM) at one end, to the rural retail markets at the other—which impact service levels. •In the race to maintain market share, incumbents have taken on Greenfield and brownfield expansion plans at a pace and scale unprecedented in the Past. Skill gaps and other challenges have led to cost and time over-runs on these projects, putting further stress on the already stretched balance sheets. •Investments in management processes, systems and people capabilities have not kept pace with the investments in assets and the changing market place. This is increasingly becoming a bottleneck for growth.
  • 4. Key Capabilities to become game changers  Resource acquisition, development and operations The pursuit of raw material security has led Indian steel companies to seek mining leases and assets globally. The capability to acquire, develop and operate these assets has become a key strategic imperative. These assets provide a natural hedge at the raw material portfolio level, and are also important for overcoming the short-term domestic challenges.  Efficient capital project management TheIndian steel companies are increasingly undertaking larger, more complex and riskier projects to meet their capacity goals. Their ability to successfully execute these projects is hindered by regulatory challenges, limited talent pools, contractors and construction labour constraints, increasing infrastructure requirements, and expectations of compliance with superior safety and environmental norms. Capital investments have not been accompanied by a commensurate investment in enhancing capability to plan and execute these projects. 1/17/2014 11:29:08 AM Prepared by Gsdhir 4
  • 5.  Customer-Centric Sales and Marketing As Indian steel companies expand, they are increasingly facing an overlap in their market and product footprint. This coupled with a lower demand growth has led to increased price competition and pressure on margins. In this scenario, increased customer centricity will differentiate the high performers.  Differentiated Supply Chains Global trends are driving increased product and distribution complexity, as diverse and digitally-empowered customers demand ever-more tailored products and services. To remain competitive, companies across industries must embrace this growing complexity while maintaining the benefits of simple, streamlined supply chains to deliver their aspirations of growth, cost, working capital and sustainability.  Human capital management India steel companies’ ability to manage and leverage its human capital will become a key differentiator and will play a key role in enabling their growth aspirations. We believe Indian steel companies will need to address the 4 D’s of managing talent. Define Discover Develop Deploy 1/17/2014 11:29:08 AM Prepared by Gsdhir 5
  • 6. Current state of Indian Steel Industry  The Indian steel industry has entered into a new era of development since 2007-08, riding high on the resurgent economy and robust demand for steel. Rapid rise in production has resulted in India becoming the 4th largest producer of crude steel and the largest producer of sponge iron in the world.  Domestic steel demand to remain muted during FY2012–17 on account of a weak macro economic environment The demand for longs is expected to increase by 19 million ton (MT) at a CAGR of 9 percent and for flats by 16 MT at a CAGR of 8 percent between FY2012 and FY2017 . This is due to relatively weaker growth prospects of flats end-user industries (such as automotive and consumer durables) than those for longs.  Increased domestic competition Incumbents and challengers have announced 71 million ton per annum (MTPA) of steel capacity addition between FY2012 and FY2017 through both brownfield and greenfield routes. However, there is considerable uncertainty on the actual capacity addition as many projects are yet to achieve financial closure due to delays or lack of regulatory clearances. 1/17/2014 11:29:08 AM Prepared by Gsdhir 6
  • 7. Based on our bottom-up assessment of the announced capacity additions, projects aggregating to 35 MTPA of crude steel capacity have already achieved financial closure. Hence, we expect a minimum aggregate capacity of 122 MTPA to be commissioned by FY2017. This capacity addition will lead to two structural changes. First, the concentration in the longs segment will increase by 5–7 percent in the medium term, deepening the sustainability challenge for secondary producers. Second, it will shift the current flatslongs capacity split of 50:50 to 60:40 by FY2017, if all the announced projects are commissioned. As a result, one can expect oversupply in flats and a capacity shortfall in longs.
  • 8. Major steel producing countries 2012: China (716.5mt) Japan (107.2mt) United States (88.7mt) India (77.6mt) Russia (70.4mt) Major Exporter of steel according to 2012: China (54.8mt) European Union (47.1mt) Japan (41.5mt) Russia (26.7mt) India 17th place (8.2mt)
  • 9. Major Importer of steel according to 2012: United States (31.5mt) European Union (29.5mt) Germany (22.9mt) South Korea (20.4mt) India 13th place (9.3mt) List of Top Steel Companies in India: TATA steel (20%) - Mumbai SAIL (10%)- New Delhi JSW steel (8%)- Mumbai Visa steel (5%)- Jaipur Bhushan steel (3%)- New Delhi
  • 10. Market share of steel by countries in 2012 50 45.5 45 40 35 30 23.6 25 20 15 10 7 5.6 5 4.7 4.5 4.5 2.3 2.3 Ukraine Brazil 0 China 1/17/2014 11:29:08 AM Japan US India Russia Prepared by Gsdhir South Korea ROW 10
  • 11. • Steel production in India has increased at a CAGR of 7.7 per cent over 2005–12. The country is slated to become the second-largest steel producer by 2015 as large public and private sector players strengthen steel production capacity in view of rising demand • Huge scope for growth is offered by India‟s comparatively low per capita steel consumption and the expected rise in consumption due to increased infrastructure construction and the thriving automobile and railways sectors Technological advancements • Increased government and corporate sector focus on using innovative production techniques for enhancing operational as well as financial performance is a positive Rising domestic and international investments • Domestic players‟ investments in expanding and upgrading manufacturing facilities are expected to reduce reliance on imports. In addition, the entry of international players* would provide benefits in terms of capital resources, technical know-how and more competitive industry dynamics Fourth-largest producer of crude steel Strong growth opportunities Notes: * - Arcelor Mittal and POSCO
  • 12. 1993–2012 1973–1992 1954–1964 • 1923–1948 • • 1907–1918 • • • • Production of steel started in India (TISCO was setup in 1907) IISC was set up in 1918 to compete with TISCO Mysore Iron and Steel Company was set up in 1923 According to the new Industrial Policy Statement (1948), new ventures were only undertaken by the central government • • Hindustan Steel Ltd and Bokaro Steel Ltd were setup in 1954 and 1964, respectively In the early 1990s, the public sector dominated steel production Private players were in downstream production mainly producing finished steel using crude steel products • • SAIL was created in 1973 as a holding company to oversee most of India's iron and steel production In 1989, SAIL acquired Vivesvata Iron and Steel Ltd In 1993, the government set plans in motion to partially privatise SAIL • • • • Foreign players began entering the Indian steel market No license requirement for capacity creation Imposition of export duty on iron ore, to focus more on catering growing domestic demand Decontrol of domestic steel prices Launch of Scheme for promotion of Research and Development in Iron & Steel sector Notes: TISCO - Tata Iron and Steel Company; IISC - Indian Iron & Steel Company; SAIL - Steel Authority of India Ltd
  • 13. Steel Form Liquid steel Composition Crude steel Finished steel End use Non-alloy steel Alloy Structural steel Stainless Ingots Semis Low carbon steel Construction steel Silicon electrical Medium carbon steel Rail steel Flat Non-flat High speed High carbon steel Source: Report on Indian steel industry by Competition Commission of India, Aranca Research
  • 14. Total crude steel production rose at a CAGR of 6.6 per cent over FY08–11 to 69.6 MT; production in the first nine months of FY12 was a little more than three-fourth of FY11 levels Finished steel production stood at 66.0 MT in FY11, recording a CAGR of 4.2 per cent during FY08–11; analysts expect production figures to improve rapidly over the next five years with the Ministry of Steel forecasting production levels at 115.3 MT by FY17 T otal crude steel production (million tonnes) T otal finished steel production (million tonnes) 52.9 52.6 47.6 42.6 49.1 44.5 43.4 42.1 36.8 17.1 FY08 41.1 16.4 FY09 16.7 FY10 Public sector 17.0 FY11* Private sector 12.3 FY12* (April Dec) 13.5 12.7 13.0 13.1 8.6 FY08 FY09 FY10 Public sector FY11* Private sector FY12* (April Dec) Source: Ministry of Steel, Aranca Research; Notes: FY - Indian Financial Year (April – March); MT - Million Tonnes, * - Provisional; CAGR - Compound Annual Growth Rate
  • 15. SAIL is the leading player in India‟s steel sector; in the first nine months of FY12, the company accounted for 18.7 per cent of the country‟s crude steel production and had a 13.5 per cent share in finished steel production Tata Steel, another household name in the country, leads private sector activity in the steel sector; during April– December 2011, the firm accounted for 9.9 per cent of crude steel production and 7.8 per cent of finished steel production India crude steel market share by production - FY12* (Apr-Dec) 9.9% India finished steel market share by production - FY12* (Apr-Dec) 7.8% Tata Steel Tata Steel 13.5% 18.7% SAIL SAIL 4.0% 4.3% RINL RINL 67.1% Other 74.7% Other Source: Ministry of Steel, Aranca Research; Notes: RINL - Rashtriya Ispat Nigam Limited, * - Provisional
  • 16. Market value of the Indian steel sector (USD billion) In 2011, the Indian steel sector‟s total market value was USD57.8 billion The sector has benefitted from rises in price and CAGR: 17.7% millennium 46.8 43.0 Over 2007–11, the sector‟s market value is estimated to have posted a strong CAGR of 17.7 per cent 36.5 30.1 2007 2008 2009 2010 2011 Source: Datamonitor, Aranca Research Note: E - Estimates
  • 17. Consumption of steel (in million tonnes) Total consumption of steel exceeded production and grew to 70.9 MT in FY12 as against 66.4 MT in FY11; over cent CAGR: 8.7% 66.4 70.9 59.3 Driven by rising infrastructure development and growing demand for automotives, steel consumption is expected to grow at an average rate of 6.8 per cent, reaching 104 MT by 2017 52.1 51.9 FY08 FY09 46.8 FY07 FY10 FY11 FY12* Source: Ministry of Steel, Indian Steel Markets Conference, Datamonitor, BMI, Aranca Research Notes: FY12* - Data for FY12 is provisional, MT - Million Tonnes
  • 18. With steel‟s demand growth outpacing growth in domestic production over the last few years, import dependency has increased Imports have increased at a CAGR of 6.8 per cent over FY07–12 In FY12, total imports stood at about 6.8 MT Steel demand and production (in million tonnes) 67 55 53 55 55 64 Steel exports and imports (in million tonnes) 7.4 7.0 71 69 6.8 6.8 60 57 5.8 50 50 4.9 5.2 5.1 4.4 3.5 4.0 3.3 2007 2008 2009 Demand 2010 Production 2011 2012 FY07 FY08 FY09 FY10 Imports FY11 FY12* Exports Source: Ministry of Steel, JSPL presentation, Aranca Research Notes: FY - Indian Financial Year (April - March), * - Data for FY12 is provisional
  • 19. Infrastructure is India‟s largest steel consumer, accounting for 63 per cent of total consumption in FY11 Sector-wise steel consumption FY12 2% 3% 0 This is not surprising given the heavy use of steel in this sector and soaring construction and infrastructure activity in the country over the past decade Engineering and fabrication is the next largest consumer, with 22 per cent of total consumption Infrastructure 10% Engineering and fabrication Autos 22% 63% Packaging Transportation Source: JSPL May 2013 presentation, Aranca Research
  • 20. Company Products Tata Steel Ltd Finished steel (non-alloy steel) SAIL Finished steel (non-alloy steel) JSW Steel Ltd Hot-rolled coils, strips and sheets Jindal Steel & Power Ltd Iron and steel Ispat Industries Ltd Hot-rolled coils, strips and sheets Welspun-Gujarat Stahl Rohren Ltd Tubes and pipes Bhushan Steel Ltd Cold-rolled coils, strips and sheets Source: Aranca Research
  • 21. • Growing investments SAIL has modernised and expanded its integrated steel plants in Bhilai, Bokaro, Rourkela, Durgapur, Burnpur and Salem • The company is in the process of expanding its crude steel production capacity to 21.4 MTPA by 2013 • Completed mega expansion of Rashtriya Ispat Nigam Limited (RINL) to more than double capacity of plant (from 2.9 MT to 6.3 MT) from 2013-14 • Strategic alliances International Coal Ventures Pvt Ltd, comprising SAIL, RINL, CIL, NTPC and NMDC, has been set up for acquisition of coal mines overseas • The consortium of SAIL and National Fertiliser Limited (NFL) has been nominated for revival of Sindri Unit of the Fertiliser Corporation of India Limited • RINL, Vishakhapatnam Steel Plant and the Power Grid Corporation of India Ltd (POWERGRID) signed an MoU to set up a joint venture company to manufacture transmission line towers and tower parts including R&D of new high-end products • Entry of international companies Attracted by the growth potential of the Indian steel industry, several global steel players have been planning to enter the market • National Mineral Development Corporation (NMDC) has signed an MoU with Russia‟s third-largest steelmaker, Severstal, for a greenfield steel plant in Karnataka • Posco Steel to invest USD12 billion in setting up a 12 MT project in India Source: Ministry of Railways, Aranca Research Notes: MOUs - Memorandum of Understanding, MT - Million Tonnes
  • 22. • Increased emphasis on technological innovations Indian steel companies have now started benchmarking their facilities and processes against global standards, to enhance productivity • These steps are expected to help Indian companies improve raw material and energy consumption as well as improve compliance with environmental and pollution yardsticks • Companies are attempting coal gasification and gas-based direct-reduced iron (DRI) production. Other alternative technologies such as Hlsmelt, Finex and ITmk3 being adopted to produce hot metal Source: Aranca Research
  • 23. Steel integrated plants under SAIL (Bhilai, Rourkela, Bokaro, Durgapur and Burnpur) Tata Steel‟s largest steel plant, based in Jamshedpur Alloy and special steel plants under SAIL (Bhadrawati and Salem) RINL steel plant in Vishakhapatnam Source: Company websites, Aranca Research
  • 24. Growing demand Policy support Growing demand in the construction industry Increasing investments Rising investments from domestic and foreign players 100 per cent FDI in the steel sector Inviting Resulting in Growing demand in the automotives sector Encouragement of sector-based R&D activities by the government Increasing number of MoUs signed to boost investment in steel Rising demand for consumer durables and capital goods Reduced custom duty and other favourable measures Foreign investment of nearly USD40 billion committed in the steel sector Note: FDI - Foreign Direct Investment
  • 25. Investment in infrastructure by the Planning Commission is expected to expand at a CAGR of 14.5 per cent over FY12– 17 Projected values of investment in infrastructure (USD billion) 191.4 investment to be USD1 trillion in the 12th Five-Year Plan (2012–17), from USD428 billion in the 11th Plan This increase in infrastructure investment is set to raise steel demand by roughly 40 MTPA during FY13–17 CAGR: 14.5% 169.0 149.1 114.1 131.2 FY13 FY14 97.3 FY12 FY15 FY16 FY17 Source: Planning Commission, Aranca Research Notes: MTPA - Million Tonnes Per Annum
  • 26. Over FY03-FY11, consumer durables has grown at a CAGR of 12.2 per cent as growth in disposable income resulted rise in their demand Capital goods and consumer durables are expected to grow at a 7.5 per cent to 8.8 per cent over 2012-2021 Automotives production expanded at a CAGR of 22.2 per cent over FY09–12 Commercial vehicles are the fastest growing segment with a CAGR of 29.8 per cent over the same period Over FY12-FY21, the automotive sector is projected to grow at a CAGR of 11.5 per cent to 12.5 per cent Consumer durables market size (USD billion) 30.2 T otal production of automobiles in India (million units) 7.3 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 14.2 5.1 9.7 Passenger vehicles Three wheelers & two wheelers FY12 2.4 FY11 3.1 0.9 3.0 0.8 2.4 0.6 FY10 1.4 FY09 FY03 11.1 4.2 8.9 3.2 3.8 1.8 0.4 2.9 3.5 16.3 5.2 4.7 21.0 6.3 CAGR: 12.2% FY16E FY21E Commercial vehicles Source: SIAM, JSPL May 2013 presentation, Corporate Catalyst India, Aranca Research Notes: E - Estimate; FY - Indian Financial Year (April - March)
  • 27. • National Steel Policy 2012 In view of the sector‟s changed dynamics, globally as well as domestically, the Ministry of Steel has initiated the process of drafting a new National Steel Policy to replace the existing National Steel Policy of 2005 • The government has set up a committee headed by the Steel Secretary to monitor the formulation of the new National Steel Policy • Four task forces have been constituted to study, analyses, consult and formulate draft policy documents on different aspects of the policy • The current policy draft proposes allotment of captive iron ore mines to producers through open bidding and putting some mines in the general category A new scheme, „The scheme for the promotion of R&D in the iron and steel sector‟, has been approved with budgetary provision of USD24.6 million to initiate and implement the provisions of the scheme as per the 11th Five-Year Plan • USD10.7 million had been spent under the scheme up to December 2012 • The development of technology for cold-rolled grain oriented (CRGO) steel sheets and other value-added products is also included under the policy purview and is allocated USD6.7 million • R&D and innovation Source: Ministry of Steel, Aranca Research
  • 28. Foreign Direct Investment Rise in export duty on iron ore • 100 per cent FDI through the automatic route is allowed in the Indian steel sector • The government hiked the export duty on iron ore to 30 per cent ad valorem on all varieties of iron ore* (except pellets) Source: Ministry of Steel, Aranca Research Notes: * - w.e.f. 30th December 2011
  • 29. • Export duty on iron ore has been increased to 30 per cent ad valorem on all varieties of iron ore (except pellets), to preserve iron ore resources for domestic use • As per the government‟s decision, the Government of India‟s 51 per cent shareholding in Eastern Investments Company Limited (EIL), under Bird Group of Companies, was transferred to RINL • • New Research and Development policy for the steel sector have been finalised/adopted for implementation New techno-economic benchmarks have been evolved on international patterns to improve performance of steel PSUs; implementation is being monitored closely • Under the Ministry, the Joint Plant Committee (JPC) studied 300 districts, 1,500 villages, 4,500 manufactures and 8,000 retailers spread over India‟s 28 states and 7 union territories to assess steel demand in the rural areas and examine the potential to increase steel consumption levels • The Ministry of Steel set up the Steel Innovation Council to promote innovative ideas in the steel sector • The New National Steel Policy for the forthcoming years is under finalisation • In April 2013, the Ministry of Steel signed a Letter of Intent (LoI) with the Tanzanian Government to strengthen cooperation in steel and mining activities Source: Ministry of Steel, Aranca Research Notes: W.E.F - With Effect From 30th December, 2011
  • 30. Developer Location Product Viraj Profiles Ltd Thane, Maharashtra Stainless steel engineering products Jindal Steel Ltd Kalinganagar Stainless steel Salem, Tamil Nadu Steel Jajpur, Orissa Metallurgical-based engineering and ancillary/downstream industry SAIL Salem SEZ Pvt Ltd Orissa Industrial Infrastructure Development Corporation Source: Formal approvals granted in the Board of Approvals after the SEZ rules coming into force,” Special Economic Zones in India website, www.sezindia.nic.in
  • 31. M&A scenario – details Period: 1 January 2012 to 21 June 2013 Deal type Number of deals Largest deal (USD million) Inbound 2 - Outbound 1 - Domestic 3 232.6 Cumulative FDI inflows Period: April 2000 to March 2013 Sector Metallurgical industries USD7.5 billion Per cent of total FDI inflow 3.9 Source: Thomson ONE Banker, “Fact Sheet On Foreign Direct Investment (FDI)”, Department of Industrial Policy and Promotion
  • 32. State MoUs signed (2011) Capacity addition (MTPA) Orissa 63 81.2 Jharkhand 49 105.1 Chhattisgarh 76 60.0 West Bengal 16 39.4 Karnataka 57 173.0 Andhra Pradesh 18 11.8 Other states 22 18.2* 301 488.6 Total Capacity addition plans 2012 Company Plans SAIL SAIL plans to invest USD27.3 billion in increasing capacity from 21.4 MTPA to 45 MTPA. In its recent expansion plan, the company modernised and expanded its integrated steel plants at Bhilai, Bokaro, Rourkela, Durgapur, Burnpur and a special plant at Salem NMDC NMDC is setting up a greenfield integrated steel plant of 3 MTPA capacity in Nagarnar, Chhattisgarh at an estimated cost of about USD3.2 billion Source: Ministry of Steel, Annual Report 2011-12; Note: MTPA - Million Tonnes Per Annum, * - Estimated figures
  • 33. Jindal Steel and Power Limited Incorporated in 1979, Jindal Steel and Power Limited (JSPL) is an integrated steel producer and the largest coal-based sponge iron manufacturer in the world. The company has an installed steel production capacity of 3 MTPA. JSPL is engaged in manufacturing long products and is specialised in producing long rails for railways and large sized H-beams as well as columns for the infrastructure and construction sector Projected crude steel capacity in the 12th Plan (million tonnes) 11.5 10.0 8.0 CAGR: 25.1% 7.0 4.5 3.0 3.0 JSPL also has significant presence across the mining, power generation and infrastructure sectors • Achievements: • • 2011 – Ranked third in the Metals category of Business World‟s Most Respected Companies Survey, 2011 2010 – Rated the World‟s Second-Largest Value Creator by the Boston Consulting Group (BCG) and the World‟s Largest Value Creator in the Mining and Materials category FY11 FY12 FY13 FY14 FY15 FY16 FY17 Source: Company website (www.jindalsteelpower.com), Planning Commission, Aranca Research
  • 34. Financial growth (USD million) Sale of steel (million tonnes) 3,315 3.8 2.8 2.0 0.8 0.3 0.5 FY06 0.7 2.8 1.9 1.2 1.0 671 0.2 FY07 2,287 1,803 1.6 1.6 1.4 2.3 3,007 103 FY8 Finished steel products FY9 FY10 FY11 Semi steel products FY12 Pellets FY06 816 197 FY07 818 431 FY08 438 721 395 FY09 FY10 FY11 Gross revenue PBIDT FY12 FY13 Source: Company website (www.jindalsteelpower.com) Notes: Company clubs iron and steel segment „s performance; PBIDT (Profit Before Interest, Depreciation and Tax)
  • 35. Strong diversified customer base of 2,758 customers TMT Re-bars Expansion in international markets Wire rods Foray into the oil & gas and cement sectors as a part of diversification FY 13–14 Steel capacity to rise from 3.5MTPA to 7.0MTPA Plate and coils Organic growth through capacity additions Column sections FY08 ISO 9001:2008 accreditation Hot-rolled parallel flange beams The iron and steel segment continues to be a major contributor (~75%) 1991 Commenced operations Long track rails 1991 1993 1995 1997 1999 2002 2006 2010 2012
  • 36. Bhushan Steel Limited Projected crude steel capacity in the 12th Plan (million tonnes) Established in 1983, Bhushan Steel Limited (BSL) is the third-largest secondary steel producer in India. The company has an existing steel production capacity of 2.5 MTPA. It primarily manufactures flat steel products for the automobile industry Products – Cold-rolled closed annealed coils, galvanised coils and sheets, high tensile steel strapping, colour coated coils, galume sheets and coils, hardened and tempered steel strips, billets, sponge iron, precision tubes and wire rods • 5.0 5.0 5.0 5.0 FY14 FY15 FY16 FY17 4.5 2.2 2.5 Milestones: • 2004 – Commissioned secondary steel production at Khapoli, Maharashtra • 2006 – Commissioned primary steel production at Meramandali, Odisha • 2006 – Commissioned secondary steel production at Sahibabad, Uttar Pradesh FY11 FY12 FY13 Source: Company website (www.bhushansteel.com), Planning Commission, Aranca Research
  • 37. Financial growth (USD million) Production of steel (million tonnes) 2,251 2.1 1,662 1.8 1.6 1.2 1,161 1,178 1.0 1,266 11 6 17 8 1.1 928 1,541 10 5 693 35 FY06 FY07 FY08 FY09 FY10 FY11 FY12 69 FY07 92 FY08 FY09 Gross revenue 221 FY10 FY11 213 FY12 9MFY13 NPAT Source: Company website (www.bhushansteel.com), Aranca Research Notes: NPAT - Net Profit After Tax
  • 38. Technological upgradation and further capacity addition Other developed products Capacity expansion (0.9 MT to 2.5 MT) S on kin ron Ironpmage ig and castings Partnership with Japanese steel producer, Sumitomo Alloy billets Alloy steel Color coated tiles Wheel, pipes and tyre and FY06 Primary steel production in Odisha Organic growth in steel and flat products axle plant (railways) Galvanised FY12 USD2.5 billion turnover 1989 Secondary steel production in UP Strong diversified customer base of 3,300 customers Cold-rolled 1989 1991 1993 1995 1997 1999 2002 2006 2010 2012
  • 39. T Steel Limited ata Projected crude steel capacity in the 12th Plan (million tonnes) Established in 1907 by the visionary founder – JN Tata, Tata Steel is among the top ten global steel companies with an annual crude steel capacity of over 28 MTPA 20.0 17.5 The company caters to sectors such as automotive, construction, consumer goods, engineering, packaging, energy & power, ship building, rail and defense & security • Milestones: • 2007 – Tata Steel and Corus were integrated at USD12 billion, making Tata Steel one of the top ten global steel producers 11.0 9.2 6.8 7.6 2009 – Tata Ryerson and HMPCL merge with Tata Steel • CAGR: 19.7% 15.1 FY11 FY12 FY13 FY14 FY15 FY16 FY17 Source: Company website (www.tatasteel.com), Planning Commission, Aranca Research
  • 40. Financial growth (USD million) Production and sales of steel division (million tonnes) 7.9 7.5 6.7 6.4 7.0 6.6 6.4 7.1 7.2 5.9 5.6 5.8 6.2 4.9 4.8 4.9 4.8 5.4 4.6 4.4 4.5 5.2 3.9 0.8 FY06 FY07 FY08 FY09 FY10 Production FY11 Sales FY12 FY13 FY06 0.9 FY07 1.2 1.1 1.1 FY08 FY09 NPAT FY10 1.5 1.4 FY11 FY12 Gross revenue Source: Company website (www.tatasteel.com), Aranca Research Notes: NPAT - Net Profit After Tax
  • 41. Developed products Technological upgradation Iron making and Capacity expansion (3 MT) castings Diversification (coal injection unit) Alloy steel Wheel, tyre and axle plant (railways) Pig iron and steel ingots FY13 USD7.0 billion turnover* M&A (Tata-Corus) Organic growth in steel 1912 Production capacity (1.6 lakh tonnes) FY06 USD3,625 million turnover Announced plans to merge Tata Metaliks Ltd and Tata Metaliks Kuboto Pipes Ltd with itself in April 2013 Blast furnace 1912 1995 1996 1997 1998 1999 2000 2002 2004 2006 2008 2010 2011 2012 2013 Source: Company website (www.tatasteel.com), Aranca Research, * - Revenues from Indian operations Note: M&A - Mergers and Acquisitions
  • 42. JSW Steel Projected crude steel capacity in the 12th Plan (million tonnes) Established in 1994, JSW Steel Ltd manufactures iron and steel products in India and abroad Products – Hot-rolled coils, plates and sheets; cold-rolled coils and sheets; galvanised sheets and coils; pre-painted galvanised coils, sheets and galvanised sheets • 17.6 CAGR: 8.8% 13.23 14.3 14.3 14.3 FY13 FY14 FY15 18.4 11.1 Achievements: • 2011 – National Sustainability Award by the Indian Institute of Metals • 2009 – Gold Award in the Metal and Mining sector • 2008 – National Energy Management Award instituted by CII FY11 FY12 FY16 FY17 Source: Company website (www.jsw.in), Planning Commission, Aranca Research
  • 43. Financial growth (USD million) Product group-wise sales (million tonnes) 7,221 6.9 7,137 5.9 5,228 4.7 4,053 3,162 2,631 1.5 1.71 1,417 1,937 1.1 0.3 0.4 0.3 Semis 178 Rolled Flats FY11 FY12 Rolled Longs FY13 FY06 269 FY07 360 FY08 421 96 FY09 FY10 Gross revenue 419 FY11 339 FY12 332 FY13 NPAT Source: Company website (www.jsw.in)
  • 44. Hot-rolled Capacity addition 7.8 MT Cold-rolled JV formed to explore, develop & mine iron ore with MML Wire rods TMT Re-bars Organic growth and integration 1994 ISO accreditations Galvanised product Special steel bars FY06 USD1,417 million turnover 1994 Production capacity (1.25 MTPA) FY 13 USD7.1 billion turnover FY 14 Saleablesteel sales to rea h c 9.75 million tonnes 1994 1995 1996 1997 1998 1999 2000 2002 2004 2006 2008 2010 2011 2012 2013 Notes: JV - Joint Venture, TMT - Thermo Mechanically Treated, MML - Mysore Minerals Limited, MTPA - Million Tonnes Per Annum
  • 45. Automotive • The automotives industry is forecasted to grow in size by USD122–159 billion by 2016 Capital goods • • With increasing capacity addition in the automotive industry, demand for steel from the sector is expected to be robust • Infrastructure The capital goods sector accounts for 11 per cent of steel consumption, and has the potential to increase in tonnage and market share • The government aims Corporate India‟s capex is expected to grow and generate greater demand for steel • Due to such a huge to increase infrastructure spending from 8.4 per cent of GDP in FY11 to 10.7 per cent by FY17 investment in infrastructure the demand for long steel products would increase in the years ahead Airports • More and more modern and private airports are expected to be set up • Development of Tier- II city airports would sustain consumption growth • Estimated steel consumption in airport building is likely to grow more than 20 per cent over next few years Note: Capex – Capital Expenditure
  • 46. Railways • The dedicated rail freight corridor network (DRFC) expansion would be enhanced in future • Gauge conversion, setting up of new lines and electrification would drive steel demand Oil and gas Power Rural India liquid fuel transportation pipeline network is likely to grow from the present 16,800 km to 22,000 km in 2014 • The government aims • This would lead to an • Both generation and increase in demand of steel tubes and pipes, providing a lucrative opportunity to the steel industry transmission capacities would be enhanced, thereby raising steel demand from the sector • The • Rural India, accounting for 70 per cent of Indian population has low steel per capita which consumption provides huge scope for growth • Policies like Bharat Nirman and Rajiv Gandhi Awaaz Yojna are driving growing demand for construction steel in rural India to add 71,000– 1,07,500 MW (Mega Watt) of capacity during the 12th FiveYear Plan Source: Planning Commission, Aranca Research
  • 47. Current state of Global Steel Industry  1/17/2014 11:29:09 AM Prepared by Gsdhir 47
  • 48. Steel Capacity Outgrows Demand Growth  During 2000~2012, global crude steel capacity ∆ 1,013 Mt to reach 2,063 Mt, whereas crude steel production ∆ 683 MT to 1,532 Mt  Chinese capacity ∆ 771Mt to 921 Mt, production ∆ 602 Mt to 731 Mt  After the global economic crisis, capacity expansion momentum slows, but the emerging economies continue to seek expansion Steed Demand vs Capacity (2000=100) Apparent steel use, crude steel equivalent Capacity, crude steel 2000=100 220 200 180 160 140 120 1/17/2014 11:29:09 AM Prepared by Gsdhir 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 100 48
  • 49. Return of Overcapacity  While world steel demand continues to grow, capacity utilization ratio trends down  No easy solutions to overcapacity in sight 100% World crude steel capacity utilisation Jun-08 92.7% 90% Apr-10 84.5% Apr-11 83.4% Sep-13 79.3% 80% Aug-10 74.2% 70% Dec-12 71.5% 60% Dec-08 59.9% 1/17/2014 11:29:09 AM Prepared by Gsdhir Jul-13 Jan-13 Jul-12 Jan-12 Jul-11 Jan-11 Jul-10 Jan-10 Jul-09 Jan-09 Jul-08 Jan-08 50% 49
  • 50. Raw Materials Side Adds to Adversity  Value chain profits has been shifting away from the steel industry  Volatility and uncertainty in raw materials prices since departure from the benchmarking pricing system value chain profit pool split evolution 100%= Iron ore Coking coal 54 8 11 23 125 156 17 44 7 81 135 15 42 46 22 Steel making (HRC) 230 22 78 28 32 61 35 27 26 1995 2000 2005 10 2011 2017 Source: McKinsey & Company 1/17/2014 11:29:09 AM Prepared by Gsdhir 50
  • 51. Steel Industry Performances Steel vs Raw materials prices Index 2005=100 1/17/2014 11:29:09 AM Steel industry stocks vs Dow Jones Index 2005=100 Prepared by Gsdhir 51
  • 52. Steel Demand Forecasts for 2013-14 Apparent Steel Use, finished steel (SRO October 2013) Mt y-o-y % growth % Mt 14.0 15 10 1 403 1 219 5 125.0* 1 523 1 400 1 200 1 300 1 219 1 141 7.0 1 430 1 475 1 600 7.9 1 000 3.1 0 3.3 2.0 800 600 0.0 400 -5 200 -6.4 -10 0 2007 2008 2009 2010 2011 2012 2013 2014 *) 2014 as % of 2007 1/17/2014 11:29:09 AM Prepared by Gsdhir 52
  • 53. Demand Forecasts for selected countries Apparent Steel Use, finished steel (SRO October 2013) Mt % 2012 2013 2014 12/11 13/12 14/13 2014 as % of 2007 1,430.3 1,475.1 1,523.2 2.0 3.1 3.3 125.0 96.2 96.9 99.8 7.8 0.7 3.0 92.2 140.2 134.9 137.8 -9.5 -3.8 2.1 69.1 63.9 64.0 63.0 -0.2 0.1 -1.6 77.6 660.1 699.7 720.7 2.9 6.0 3.0 172.2 71.6 74.0 78.2 2.6 3.4 5.6 151.8 25.2 26.0 27.0 0.6 3.2 3.8 122.3 54.8 57.3 60.4 12.8 4.6 5.4 149.7 63.2 64.3 69.0 2.2 1.7 7.3 127.2 Developed Economies 390.2 384.1 390.5 -1.7 -1.6 1.7 82.4 Emerging & Developing Economies excl China World excl. China 380.0 391.4 412.1 4.2 3.0 5.3 126.0 770.2 775.4 802.6 1.1 0.7 3.5 100.3 World United States European Union (27) Japan China India Brazil ASEAN (5) MENA 1/17/2014 11:29:09 AM Prepared by Gsdhir 53
  • 54. Key Trends in Post-Crisis Period Steel Demand  Multi-speed recovery continues driven by emerging economies, but weakening growth in the emerging world  Eurozone stabilizes and finally positive growth expected in 2014  China moves into slower growth phase  Key emerging economies struggling with structural issues Multi-Speed Recovery of Steel Demand 180 2007=100 World China Developed Economies Em. & Dev Economies excl. China . 160 140 120 100 80 60 2007 1/17/2014 11:29:09 AM 2008 2009 2010 201 1 Prepared by Gsdhir 2012 2013 2014 54
  • 55. Regional Share in World Steel Demand Apparent Steel Use, finished steel (SRO October 2013) Emerging & Developing Economies Developed Economies China 2000 2001 41.5% 58.5% 16.4% 2002 2003 53.9% 20.5% 46.1% 2004 2005 2006 51.5% 23.3% 48.5% 2007 2008 2009 47.8% 27.4% 52.2% 2010 2011 47.0% 28.3% 53.0% 2012 2013 2014 41.7% 33.3% 33.1% 1/17/2014 11:29:09 AM 58.3% 58.4% Prepared by Gsdhir 41.6% 11 55
  • 56. China Entering a New Phase of Development  After soft landing, renewed focus on rebalancing of the economy  Less steel intensive growth to come, implying steel demand growth will underperform GDP growth  Future focus will be on capacity closures, environmental performance and upgrading Growth trend of China’s steel use 1/17/2014 11:29:09 AM Steel intensity (ASU/GDP) Prepared by Gsdhir 56
  • 57. Economic Growth and Steel Demand S-Curve of different countries Thailand China Indonesia United States Japan South Korea India Per Capita Steel Use finished steel, kg, 2012 ASU per capita, ASU, crude steel equivalent per capita, kg 1 400 488 506 1 200 1 000 305 279 222 Japan 220 127 600 40 57 400 Africa United States India 200 Brazil Middle United EU (27) China East States Japan World 0 0 10 20 30 GDP per capita, 2005 PPP$, 1/17/2014 11:29:09 AM 40 50 thousands USD Prepared by Gsdhir 57
  • 58. How Far Will Chinese Steel Demand Grow? Positive Further room for urbanization and Industrialization Low level of development in the West Negative Condensed growth, high share of investment in GDP Environmental regulations, resource constraints Manufacturing relocation out of China Speed and mode of development in the West China provincial steel use per capita (2011, kg/per, crude steel equiv ) China (2012) US (1973) 1/17/2014 11:29:09 AM Japan (1973) Prepared by Gsdhir 58
  • 59. End of the China Effect, Next Growth Engine? Evolution of Steel Demand (1950-2014, crude steel equiv) Mt CAGR 2007-2014 3.1% 1 800 1 600 RoW CAGR 2000-2007 6.6% 1 400 1 200 China CAGR 1975-2000 1.1% 1 000 former USSR CAGR 1950-1975 5.0% 800 600 US, EU, Japan 400 200 2010 2005 2000 1995 1990 1985 1980 1975 1970 1965 1960 1955 1950 0 Contribution to Apparent Steel Demand Growth( ∆ Mt) World Developed China Other Emerging 1992-2000 142.6 84.1 51.1 7.4 2000-2007 480.3 74.2 297.8 108.4 2007-2014 320.2 -85.5 314.8 90.9 1/17/2014 11:29:09 AM Prepared by Gsdhir 59
  • 60. Developing World: Strong Fundamentals Population (million) Urbanisation (%) GDP per capita, (PPP$) Steel Use/ capita(Kg) 2012 Mexico Turkey Brazil Thailand China Indonesia India Vietnam 1/17/2014 11:29:09 AM 2020 2010 2020 2012 2020 2012 116 126 77.8 80.5 14.4 17.3 173 75 81 70.5 78.6 14.1 17.9 382 198 210 84.3 86.8 11.0 13.8 127 70 72 33.7 38.0 9.4 12.9 234 1 354 1 388 49.2 61.0 9.0 15.3 488 245 263 49.9 57.2 4.7 6.7 51 1 258 1 387 30.9 34.8 3.7 5.7 57 90 96 30.4 36.9 3.4 5.1 122 Prepared by Gsdhir 60
  • 61. Environmental Challenges  Energy use reduction efforts in developed world already at theoretical limit and limited progress in Break-Through technologies. Pressure on costs and also negative impact on steel demand growth  However. steel has been successful in providing solutions to the sustainability - lighter vehicles, renewable energy, etc … Energy Intensity of steel production (NAmerica+Japan +EU27) 1/17/2014 11:29:09 AM Energy intensity of iron and steel production (GJ/t of crude steel) Prepared by Gsdhir 61
  • 62. Steel as Solution to Sustainable Future  Innovative use of steel saves six times as much CO2 as is caused by the production of the steel → LCA approach Case study 1 2 Energy industry 3 4 Traffic HH, ind., CTS1 5 6 Emissions in the steel production3 Net CO2 reduction potential Efficient fossil fuel PPs 29.5 Wind power plants 0.03 1.9 14 : 1 1.3 : 1 8.4 11.2 0.9 1.1 : 1 1.0 1.0 9:1 9.2 Combined heat/power 0 3:1 0.7 Weight reduction cars 7 ~ 200 : 1 0.1 2.1 Weight reduction trucks 32 : 1 0.4 5.0 Other renewables2 Efficient e-motors ~ 400 : 1 <0.1 14.2 Efficient transformers Ratio between CO2 reduction/emission4 5 10 30 0 Mt 8 1 9 10 11 Mt 6:1 1.HH = households; CTS = commerce, trade, and service 2. Geothermal, biomass, hydro 3. CO 2 expenditure for other materials not examined; values are rounded 4. Ratio relates exclusively to the emissions Source: BCG analysis 1/17/2014 11:29:09 AM Prepared by Gsdhir 62
  • 63. Long Term View on Steel Demand  Global steel demand could reach 2.2~3.0 billion in 2050 Long T erm Evolution of World Steel Demand Years 1970 589 1975 640 1980 713 1985 719 1990 773 1995 743 2000 846 2005 1 139 2010 Mt Mt 1 404 2012 1 542 3 000 2 500 2 000 1 500 1 000 500 0 1870 1890 1910 1930 1950 1970 1990 2010 2030 2050 *apparent steel use, crude steel equivalent 1/17/2014 11:29:09 AM Prepared by Gsdhir 63
  • 64. Conclusion  Despite current difficulties, future scenarios for the steel industry have optimistic starting point: Urbanization and population growth will support industry growth for considerable time  Surplus capacity in the industry will be difficult to reduce quickly, but can be absorbed in long term  Steel industry will continue to provide the basis for sustainability of the modern society through innovation  But the industry is facing formidable challenges ahead  Changing position in value chain through expanding product mix, development of new applications becomes crucial for steel industry  Sustainable development and, in particular, Life Cycle Assessment focus provides interesting challenges to the steel industry 1/17/2014 11:29:09 AM Prepared by Gsdhir 64
  • 65. Technological Developments in Iron and Steel Industry Emerging Energy-efficiency and Carbon Dioxide Emissions-reduction technologies for the Iron and Steel Industry  Iron and steel manufacturing is among the most energy-intensive industries and accounts for the largest share, approximately 27 percent, of global carbon dioxide (CO2) emissions from the manufacturing sector. The ongoing increase in world steel demand means that this industry’s energy use and CO2 emissions continue to grow, so there is significant incentive to develop, commercialize and adopt emerging energy-efficiency and CO2 emissions-reduction technologies for steel production. Although studies from around the world have identified a wide range of energyefficiency technologies applicable to the steel industry that have already been commercialized, information is limited and/or scattered regarding emerging or advanced energy efficiency and low-carbon technologies that are not yet commercialized. This report consolidates available information on 56 emerging iron and steel industry technologies, with the intent of providing a well-structured database of information on these technologies for engineers, researchers, investors, steel companies, policy makers, and other interested parties. For each technology included, we provide information on energy savings and environmental and other benefits, costs, and commercialization status; we also identify references for more information. 1/17/2014 11:29:09 AM Prepared by Gsdhir 65
  • 66. Category of steel: Carbon Steels- contain trace amounts of alloying elements and account for 90% of total steel production Low Carbon Steels/Mild Steels contain up to 0.3% carbon Medium Carbon Steels contain 0.3 – 0.6% carbon High Carbon Steels contain more than 0.6% carbon Alloy Steels- contain alloying elements (e.g. manganese, silicon, nickel, titanium, copper, chromium and aluminum) Stainless Steels- contain between 10-20% chromium Tool Steels- contain tungsten, molybdenum, cobalt and vanadium in varying quantities
  • 67. No. Report Section/Technology Name Commercialization status 3.1. Emerging Agglomeration Technologies 1 3.1.1. Use of Biomass in the Sintering Process Demonstration 3.2. Emerging Coke-making Technologies 2 3.2.1. Single-chamber-system Coking Reactors Demonstration 3 3.2.2. Battery Under-firing with Advance Diagnostics and Control Development 3.3. Emerging Technologies for Ironmaking Using Blast Furnace 4 Pilot 5 3.3.2. Blast Furnace Optimization by Using Computational Fluid Dynamics Modeling Demonstration 6 3.3.3. Blast Furnace Optimization by Using X-ray Diffraction Analytical Technique Demonstration 7 3.3.4. Blast Furnace Heat Recuperation Demonstration 8 3.3.5. Plasma Blast Furnace Development 9 10 3.3.1. Hot Oxygen Injection 3.3.6. Blast Furnace Slag Heat Recovery Pilot/ Development 3.4.7. Charging Carbon Composite Agglomerates Demonstration 3.4. Alternative Ironmaking Technologies 11 3.4.1. COREX® Process Commercial with very low adoption rate 12 3.4.2. FINEX® Process Commercial with very low adoption rate 13 3.4.3. Tecnored Pilot 14 3.4.4. ITmk3 Ironmaking Process Demonstration 15 3.4.5. Paired Straight Hearth Furnace Development 16 3.4.6. Coal-Based HYL Process- A Syngas based DRI Plant Commercial with very low adoption rate 17 3.4.7. Coal-Based MIDREX Process Demonstration 18 3.4.8. Fine Ore Reduction in the Circulating Fluidized Bed (Circored® and Circofer®) Demonstration/Pilot 19 3.4.9. Cyclone Converter Furnace Pilot 20 3.4.10. Producing Iron by Electrolysis of Iron Ore (Molten Oxide Electrolysis) Research/Development 21 3.4.11. Suspension Hydrogen Reduction of Iron Oxide Concentrate Research/Development 22 3.4.12. Ironmaking using Biomass and Waste Oxides Research 3.5. Emerging Technologies for Steelmaking Shops 23 3.5.1. Sensible Heat Recovery from Electric Arc Furnace Off Gases Commercial with very low adoption rate/ Pilot 24 3.5.2. Electrochemical Removal of Zinc from Steel Scrap Demonstration 25 3.5.3. Continuous Horizontal Sidewall Scrap Charging Pilot 26 3.5.4. New Scrap-Based Steelmaking Process Predominantly Using Primary Energy Development 27 3.5.5. ECOARCTM Demonstration 28 3.5.6. Optimization of Basic Oxygen Furnace and Electric Arc Furnace Post Combustion Using Computational Fluid Dynamics Modeling Pilot 29 3.5.7. Improving the Energy Efficiency of Electric Arc Furnaces through Laser- Pilot 1/17/2014 11:29:09 AM 3 Prepared by Gsdhir
  • 68. No. 30 31 32 33 34 35 Report Section/Technology Name based Optimization of Post Combustion 3.5.8. Model-based Steel Temperature Measurement for Electric Arc Furnaces 3.5.9. In-Situ Real-Time Measurement of Melt Constituents 3.9.10. Injection of plastic waste in Blast Furnaces 3.9.11. Injection of Plastic Waste in the Electric Arc Furnace 3.9.12. Use of Waste Tires in EAF Commercialization status Development Development Demonstration Pilot Commercial with very low adoption rate 3.6.4. Continuous Steelmaking for Electric Arc Furnace 3.6. Emerging Casting Technologies 3.6.1. Near-net-shape Casting/Strip Casting Research 37 3.6.2. Continuous Temperature Monitoring and Control in Continuous Casting 3.7. Emerging Rolling and Finishing Technologies Development 38 3.7.1. High-Temperature Membrane Module for Oxygen Enrichment of Combustion Air for Fuel-Fired Industrial Furnaces Pilot 39 40 41 3.7.2. Next-generation System for Scale-Free Steel Reheating 3.7.3. Thermochemical Recuperation for Steel Reheating Furnaces 3.7.4. Hot Strip Mill Model Research Research Commercial with very low adoption rate 42 3.7.5. Innovative Reheating Furnace Management Using a Continuous Burn-Out Measuring System Pilot 43 44 3.7.6. Oxygen-rich Furnace System for reduced CO2 and NOx emissions 3.6.2. HotEye® Steel Surface Inspection System Development Commercial with very low adoption rate/ Development 45 3.7.7. NOx Emission Reduction by Oscillating Combustion 3.8. Emerging Recycling and Waste Reduction Technologies 3.8.1. Recycling Basic Oxygen Furnace Slag 3.8.2. Rotary Hearth Furnace Dust Recycling System 3.8.3. Recycling of Stainless Steel Dust by Injection into Electric Arc Furnace 3.8.4. Regeneration of Hydrochloric Acid Pickling Liquor 3.8.5. Recycling of Waste Oxides in Steelmaking Furnace Pilot 36 46 47 48 49 50 Commercial with very low adoption rate Development Demonstration Pilot Pilot Pilot 3.9. Carbon Capture and Storage Technologies for the Iron and Steel industry 51 52 53 54 55 3.9.1. Top-gas Recycling in Blast Furnaces with Carbon Capture and Storage 3.9.2. Advanced Direct Reduction with Carbon Capture and Storage (ULCORED) 3.9.3. HIsarna with Carbon Capture and Storage 3.9.4. Post-combustion Carbon Capture Using Chemical Absorption Technologies 3.9.5. Geological Sequestration of Carbon Dioxide Using Basic Oxygen Furnace and Electric Arc Furnace Slag Pilot Development Pilot Development Research 56 3.9.6. Integrating Steel Production with Mineral Sequestration Research 1/17/2014 11:29:09 AM 4 Prepared by Gsdhir
  • 69. THANK YOU 1/17/2014 11:29:09 AM Prepared by Gsdhir 69