Tata Steel to ramp up European production

But sees a Q1 loss of Rs 2,209 cr

Tata Steel, the sixth-largest steel maker in the world, will ramp up its European production to 80 per cent of the capacity from the current 50 per cent by the year-end, as demand is picking up in the West.

“We expect an economic revival and production would be increased to 80 per cent of the capacity by the end of this year. It would increase further to 100 per cent by next year,” Tata Group Chairman Ratan Tata told Tata Steel shareholders at the company’s 102nd annual general meeting today. The correction in iron ore prices and increase in liquidity were positive signs for the steel industry, he said, adding the trade fall in Europe and the US has bottomed out. “Demand is coming back in the auto sector, especially in these geographies,” Tata added.

In the first quarter, however, weak demand and low steel prices dented the revenue of the company and it posted a consolidated net loss of Rs 2,209 crore. Total consolidated income fell 46 per cent to Rs 23,496.21 crore during the June-ended quarter from Rs 43,548.86 crore.Tata said the loss reflected the squeeze in demand in the US and Europe, and added that the company aimed to rationalise operations in Europe and optimise cost effectiveness.

In a move to ensure 50 per cent security of raw materials — iron ore and coking coal — for its European subsidiary Corus by 2015, the Indian steel maker is looking to acquire mines in Ivory Coast, Brazil and Canada, said Tata.