1. Business Standard l Sponsored Section
"Eastern India will be the Pioneer for
Indigenous Coke Industry"
Ganesan Natarajan
Whole Time Director, President & CEO, Ennore Coke Limited
ducers. traditionally been captive, as coke also coming in plenty. Natarajan Chinese production of
In fact, there is an acute is being produced in the coke feels that the trend of importing coking coal has not
shortage of good quality coking oven batteries of integrated steel from Russia is likely to remain. increased in line with
coal globally, China has become a plants as well as Pig iron plants. "There are only two grades of its steel production.
net importer of coking coal from All major integrated steel plants coal which are available. One is As a result China has
last year, making matters worse. have recovery type captive coke low volatile and the other is high become a net
China imported 35 mt of coking oven batteries. volatile. The Russian coking coal is importer of coking
T
here can be little debate country relies primarily on coal last year and with steel pro- Though merchant cookeries second grade. Thus, to make steel coal to care of its
about the fact that the imports. India imports coking coal duction around the world increas- have a capacity of 7.6 mt, produc- production cost effective, Indian domestic needs. Last
whole world is looking at to manufacture coke, in a segment ing, the industry is starting at a tion has never touched more than steel makers are blending these year China imported
India, after China, as the dominated globally by China, global shortage of coking coal in 2.5 mt at any given point of time, two grades of coal. So we would 35 mt of coking coal
steel market with the which, besides being the largest the near future. pointed out Natarajan. be seeing a lot of Russian coking and this year it is
most action. With a current crude producer, is also the biggest con- Mr. Ganesan Natarajan, Chief The country produced around coal coming into the market", expected to touch 45
steel production of around 57 mil- sumer and exporter. Moreover, the 40 percent "This also indicates that cok-
Executive Officer, Whole Time 20.5 mt of coke in 2009- export tax on met coke levied by ing coal price would not be going
lion tons (mt) and steel making Notwithstanding the slow Director and President of Ennore 10 and of this, the share
capacity poised to reach 100 mt economic growth in 2008 and China since August 2008 and per- down any further in near future
Coke Ltd. said that coke making of merchant coke mak- manent closure of 11 mt pet and any trend of falling price is
by 2010-13, it is evident that cok- 2009, it is expected that global capacities have moved up with ers was 2 mt, which is
ing coal and coke demand will see demand for metallurgical coal will annum coke capacity in Eastern being arrested. Though the pre-
increasing need. However, the lower than the previous Europe have created a large vacu- sent quarterly price is a 7 percent
a big jump. The scenario is robust grow by 6 percent per annum in production figures are yet to pick year. Although the pro-
even at the demand side of the the coming years, driven by rapid um in coke markets globally. The drop from the contracted price of
up similar pace. duction capcities under- coke making process is seeing a last quarter, but in actual terms it
market. growth in integrated steel making It also to be kept in mind went some increase,
India's steel consumption capacity in emerging markets - global shift from Europe to Asian is an increase in price over the
that in most plants expansions are but the production countries. China used to com- price of the previous quarter. This
rose 8 percent in the year ended notably China and India. The five coming up mostly in the blast fur- remained the same.
March 2010, to 56.3 MT, from year trend growth forecast for mand 50 percent of world export has been supported by the steady
nace route. Even Corex Taking of capacity till 2008,w hich ahs dropped dras- increase of spot coking coal price
52.3 MT in the previous year, a global metallurgical coal con- Technology requires coke and the utilization, it is to be
per the Ministry of steel. sumption is 5/7 percent per tically. over the last two to three weeks".
ferro alloy industry is also doing noted that the current The pinch was not felt to that Price of met coke has nearly
Expectations are even brighter. annum. well. production by the
At a juncture like this, with The present situation is criti- extent due to the downturn in the doubled from around $ 300 per
Thus, even with a very con- Indian merchant coke last two years. But, once coke ton (fob China) to over $ 550 per
massive expansion plans laid cal with China almost stopping servative crude steel production makers is low - at
down by the steel majors like steel export of cocking coal demand return to pre crisis levels ton (fob China). Price of met coke
Natarajan explained. MT. China had been 3exporting of 30 MT, it is difficult to say how follows the same trend of coking
Authority of India, TATA Steel and and coke. From here Meanwhile, the integrated coking coal till 2003, and the
JSW among others, a major con- on therefore, the this huge gap is going to be filled, coal but the rise is generally
steel plants mostly have their own trend reversed in 2004. with no signs of China reversing it steeper.
cern for the industry lies in the availability situation captive sources and thus import China produced 345 mt of
availability of coke and coking can only worsen. India policy on export tax. THE WAY FORWARD
very little. India generally sees a coke in 2009. Historically China THE PRICE CURVE - THE With a host of steel compa-
coal. has severe shortage total import of around 24 mt of has been a major exporter of
Coke, a derivative of coking of premium quality CONTRACT PRICING nies lining up major investment
coking coal, mostly by secondary coke. But, Chines4e export of met Being a crucial raw material proposals, the Indian steel indus-
coal, plays a very significant rise in hard coking coal for steel producers. Out of this, only coke dropped dramatically since
metallurgical process. Worldwide, steel making, which is for steel making and with huge try is likely to receive huge domes-
around 6 to 7 mt is imported by middle of 2008 due to imposition availability crunch, the price of tic and foreign investments, and
the main demand for coke comes being primarily met the integrated plants, accounting of 40 percent export tax on coke.
from the steel and steel intermedi- through imports.With coking coal has always been a the demand of coking coal and
for 25 to 30 percent of the total Consequently, Chinese met coke rocky story. The price of coking coke will grow exponentially.
ary industry which uses low ash steel production imports, he explained. Indian exports dropped to just 0.5 mt in
metallurgical grade coke as the capacity increasing, coal and met coke has almost Although the Indian coke
imports are expected to reach 30 2009. doubled in the last 12 months and industry is planning capacity addi-
primary reducing agent for iron in the situation will get mt this year. Thus, this would have a direct
the blast furnace route. more critical. With is continuously increasing with no tions and some projects are
CHINA - THE GLOBAL impact on the Indian market. sign of abating. Coking coal pric- expected to come on stream in
Although India is well China also keeping RULER Natarajan explained that on one
endowed in terms of some crucial their coking coal for themselves, ing contracts are now being fixed the near future, the additions are
rise in the next five years, the around 60 percent. This is primari- Speaking of imports, it has to hand China has stopped exporting on a quarterly basis. The not very large and India is
raw materials like iron ore, but in the shortage will deepen further demand supply gap promises to ly owing to the type or the size of be noted that China, a predomi- and on the other, China is also
the coking coal segment, the for domestic merchant coke pro- first quarter price for 2010-11 was expected to remain dependent on
be significantly large. the individual plant. Natarajan nant player in this segment, has buying coke as the Chinese are settled at$ 200 per ton, which import of coke as well as coking
INDIAN SCE- pointed out that many units have stopped exporting now. China closing the coke plants owing to went up to $ 225 per ton for the coal.
NARIO a capacity of only 3000 tons per accounts for about 60 percent of environmental issues and by second quarter and has settled at Natarajan said the demand-
At present, India month. They run on a standalone world steel production and hence 2011 will also have to close cer- $ 209 per ton for the October supply gap is slated to widen.
produces around 20- basis and it is impossible for them automatically the largest con- tain coking coal mines. Quarter. Overall, India may be looking at a
22 mt of met coke and to bring a ship load of raw mate- sumer of coking coal and coke. GLOBAL SCENE "Spot price was trading at $ met coke shortage as early as in
the rest is met rials for 10 months. China influences the demand sup- Globally, the scenario in the 200 per ton and below during the 2011 and beyond, unless the fac-
through imports. THE SUPPORT OF ply dynamics and pricing of cok- met coke industry is even worse last quarter which was lower than tors causing it do not change
Production is under- IMPORTS ing coal and met coke to a great than that of coking coal. With no the contracted rate of $ 225 per overnight, which is most unlikely
taken by merchant In the given situation, there is extent. new source of coking coal in sight ton. Hence the contracted price of to happen. India being totally
coke makers as well no option for India but to fall back China has been undertaking to meet the growing demand, $ 209 per ton is actually an integrated with the global
as the integrated steel on imports. India gets its coking consolidation of cocking coal coking coal will remain in tight increase in price over the prevail- demand supply dynamics would
plants. In India, major coal from Australia, the US and mines and has closed many useful supply in the years to come and so ing spot prices and indicates a face similar shortages as other
coke production has now imports from Russia area are mines. Consequently, the total would be met coke. strong future". parts of the world.
Mobile applications beyond communication
loaded, generating nearly $30 bil- customer centric and can augment mobile healthcare applications. Cell airline schedules or company data issue involved is that networks strate the service to enter- Security is
lion in revenue - more than fourfold the profit margins. phones are increasingly used as sheets. Media houses have suc- should be ready to support MMS. prise customers. The an obvious
increase over 2010. Games, mobile If we talk about mobile appli- common clients for a wide suite of cessfully implemented the short Operator's Benefit enterprise customers reason of con-
shopping, social networking, utili- cations -it is mobile barcode appli- distributed, database-centric code to feed news to subscribers. By the end of 2010, the 3G should feel confident cern. It is easy to
ties and productivity tools will con- cation, which demands attention. healthcare applications in develop- The Enterprise segment has services will be rolled out in the about the product extract confiden-
tinue to grow and will be the most Mobile Ticketing, getting Boarding ing regions. This is particularly true also gained immense attention of country. However 3G demand will which can reduce tial information
popular applications among the Tickets on mobile, and mobile pay- for rural developing regions where VAS developers and operators in be dictated by affordability, adop- costs, improve once data leaves the
customers. ment using barcode are some of its the bulk of the healthcare is han- recent times. Today, Enterprises tion level of 3G services and pene- effectiveness company server and
The Indian market trends in applications. We can book tickets dled by health workers due to lack across the verticals are embracing tration of 3G handsets across the and efficiency rides on public network.
Manisha Panda
data segment is in synch with glob- online and get them inform of bar- of doctors. Unfortunately, the cur- the idea of adopting diverse mobile country. The rural handset figure and increase Issues like handsets get-
al trends. The data market was tab- codes which is scanned and it gives rent distributed system is far too applications that offer tangible has reached 100 mn mark and this sales. This is ting misplaced or someone
T
he Indian Telecom Sector has
been growing in leaps and ulated around 5-10 mn during early easy entrance to the movie hall. heavy-weight for mobile applica- benefits like cost savings, making is where next wave of growth is set the great- else using the handset puts
bounds.At the same time the 2009. Today the number of data Similarly one can get airline board- tions, particularly in light of the mobile applications an integral to take place. However the rural est prospect the company's business at
competition has risen to a users has increased to 25 mn. The ing ticket as barcode instead of high communications cost. So, part of their communications strat- handset market is mostly driven by for operators. risk. In a Business to Customer
fierce level due to intensive price mobile applications are being hard copy and directly proceed for innovative solutions can be intro- egy. The services could be real time cheap Chinese handsets and local- Challenges (B2C) scenario, a customer might
wars. It has become inevitable for designed in a manner to focus on 3 security check. However these duced catering to the needs of the allocation of tasks to field service ly manufactured handsets which The present growth is note- not like others snooping around
incumbent and entrant to adopt specific areas: Entertainment, applications are yet to capture the health sector. One of the innovative engineers with respect to their are not compatible with many worthy, but there are areas that his data. So, companies like
strategies to maintain profit mar- Information and Voice. However market in India. Banking is a mobile applications can be physical location; Application initi- mobile applications. As a result the have kept mobile apps from gain- VeriSign have been supporting
gins and survive in business. the level of penetration of data is promising sector for VAS develop- "Efficient Lightweight Mobile ated calls for debt recovery/bill customer gets discouraged to ing widespread adoption in the application developers and net-
The Indian market is getting negligible in rural India. Reason ers who can develop applications Records "(ELMR) system. payment; Click to call features for experience new services. Even a business world. work operators to give secure envi-
exposed to new technologies like being unawareness, preference to featuring banking transactions. This is one product which has Enterprise web sites; Targeted dis- rural customer looks for rich con- ROI and Security are the obvi- ronment for users especially where
3G and there are lot of opportuni- voice services over data services as One can get his credit/debit card been implemented in African coun- tribution of information to enter- tent which fulfils basic require- ous questions management would financial data is being exchanged.
ties to be explored. The Indian cel- data services are perceived to be details enclosed within a barcode tries; it meets the urgent demands prise workers, etc. Millions of ments like live radio or basic value ask a CIO trying to implement So it becomes vital for enterprises
lular market is majorly voice centric expensive. The Indian subcontinent which in turn can be a substitute to of health sector in the rural areas. investments have been made in added services. Secondly the PC enterprise mobile applications. to feel confident before using the
with 60% revenues coming from is quite varied in nature with local actual cards. The secured barcode The Indian health sector can be building Enterprise VAS by firms penetration is less and rural folks Adopting any mobile application is mobile applications and deploy
rural regions. So the next wave of dialect changing every 10 Kms. This bearing account details can be benefited by similar innovative and like Mobien Technologies, mGlitz, find it complicated to operate a an expense, with no assurance of secured environment for their cus-
growth will be in the rural market. creates difficulty in communicating scanned and further transactions cost effective mobile applications. Mobiquest and many more. computer. This limits Broadband direct returns. For instance, cus- tomers.
The level of adoption of mobile ser- with customer. Even the variety in can be made. Such application will Mobile technology finds its Mobiquest, an enterprise platform penetration as well. Considering tomers may use a bank's short The need to access day-to-day
vices is need driven. It is dependent localised services cannot be solu- guarantee an easy shopping expe- application in education as well. company, has developed an enter- the Indian demography, it is code toll free but the bank has to applications from remote locations
upon factors like affordability, tion each time. The drive to gain rience to the customer. Mobile phone vocational training is prise VAS solution-MobiForms, expected that affordable, user pay the application providers and or from mobile devices, the need to
awareness and related social fac- access to rural retailers is, in some Several rural regions around one of the applications which is which can help one complete friendly mobile applications can the operators. collaborate and share files with co
tors. Mobile applications is forecast ways, as critical as the one to reach the world, especially in under- being provided as part of value audits, surveys, questionnaires on a drive data revenues. It is clear that Of course, returns are in the workers across the globe, the grow-
to be an important profit driver in consumers. If we look at rural retail developed areas, do not have added service by operators like simple common mobile phone operators have larger scope to shape of better customer focus. If ing demand to have better produc-
near future, as indicated through in India, the outlet size is very access to basic healthcare services Airtel. It becomes an effective device. explore in B2C segment. customers get better service they tivity tools remotely, and lastly the
key research conclusions of small. Merchants will often stock and much of the burden of health- medium of mobile learning for peo- The insurance companies have The mobile applications may remain loyal and bring in more general growth in mobile and
Gartner. just one brand in a category; they care delivery falls on local health ple in rural areas. Most of these expressed concerns towards reduc- involve higher initial capex but they business. Mobile application remote workers drive the need for
According to Gartner research, do not have the resources to stock workers who have limited skills applications are SMS based which tion in processing time by empow- have potential for improved cus- becomes a great tool in acquiring remote/mobile applications across
worldwide revenue from mobile multiple brands. They will stock the and expertise. In such scenario cell are convenient and economical. ering evaluators with MMS- tomer retention and this would new customers and retaining old businesses and industries. With
applications will total $6.8 billion brand that sells the most. With lim- phones are being used as a poten- A popular SMS application in enabled phones, so that they can benefit operators to reduce opex ones. In the Business to Business realization of its true potential the
in 2010, an increase of 60% over itations, the telecom service tial tool for improving rural health- the market is short code. Users SMS send snapshot of the documents to for enterprises. Enterprise applica- (B2B) space employees have flexi- enterprises and the operators have
the $4.2 billion spent in 2009. providers are trying to bring revolu- care. The open-source movement in to the short code -the code of the processing centre. The claim tions will help operators boost rev- bility at their disposal which makes been inspired to deploy content
Gartner predicts that in 2013, 21.6 tion by designing and deploying mobile software has opened application, to access real time amount can be calculated and enues by offering higher value ser- delivery of business easier and rich mobile applications. Certainly
billion applications will be down- killer applications which will be opportunities for developing new information like train reservation, referred to the field guy. The only vices and they need to demon- reduces the turnaround time. it will be a win-win situation for all.