JSW Steel to maintain capacity utilisation at 80% at Karnataka plant

Beneficiation taking cost of production higher

The shutdown of one of JSW Steel Ltd’s corex furnaces at its 10 mn tonne Vijayanagar plant in Karnataka is expected to keep the capacity utilisation of the unit at 80% until end-September, a source close to the development told Business Standard today.

The corex furnace remains shut for relining and capacity enhancement purposes, the company had said in a release early this week. This furnace will commence production by end of September, it had said.

The Mumbai-based primary steel maker produced 991,000 tonne of crude steel in July, up 47% from same period last year.

"A lot of low grade iron ore has gone into making of this crude steel as the quality of ore available was poor," said the source. "We (JSW Steel) have been able to use this low grade ore mainly because of the beneficiation plant that we have," he said.

Processsing low grade iron ore through a beneficiation unit allows the steel producer to enhance the quality of its iron ore and use it to make crude steel.

However, due to increased beneficiation at the Karnataka plant, the cost of producing the steel has been shooting up, said the source.

On usage of scrap for the making of steel, the source said, JSW Steel has maintained the usage of 7-9% of scrap in the making of the alloy despite the hurdles to procure good quality iron ore.

JSW Steel produces long as well as flat products that find application in the construction and auto industry, respectively.