Sail Set For Marketing Push For Pipe Division

With the Steel Authority of India's (SAIL) Rourkela Steel Plant (RSP) poised to start production at the continuous casting facility shortly, the steel major has commissioned its central marketing organisation to launch a special marketing drive for its pipes division

The thrust of the marketing drive would be to pave the way for RSP's expanded product base in its post-modernisation period of operation.

RSP is a bulk producer of steel pipes with an annual production capacity of 130,000 tonne at present.

The plant has two mills for manufacturing steel pipes _ an electric-resistance welding (ERW) pipe mill and a spiral welding (SW) pipe mill.

According to a SAIL spokesperson, the steel major has already signed up 25 pipeline projects in the country for RSP's pipes.

These include Indian Oil Corporation's(IOC) Kandla-Bhatinda pipeline project, the Gujarat pipeline project, the Maharastra Water Supply & Sewerage Board and Calcutta Metropolitan Development Authority.

The company has also executed export orders of ERW pipes for projects in Australia, the CIS countries, the middle-east, New Zealand and Burma. Exports of pipes would constitute a key feature of the marketing drive being designed for pipes.

"The ultimate objective of the strategy is to arrest the growth of global players in the domestic markets and simultaneously expand SAIL's market share. Also since, RSP's production is poised for an increase, the company would have to emphasise on expanding its presence in global markets as well to offset the increased production," he added.

The reason for getting into a new marketing drive with vigour at this stage is the sudden expansion in demand in the steel pipes segment following the liberalisation of the petroleum sector.

"This has resulted in the establishment of a number of refineries and increase in the network of petroleum products," said officials.

Considering the changing pattern of the market environment and stringent order specifications becoming a rule with customers, the public sector steel giant has decided to highlight the positive features of its pipes through customer meets and advertising campaigns, they added.

The first of the series of the customer meets was organised early this month in Bangalore by the company's central marketing organisation.

At the meet, A K Singh, managing director of RSP said, "The segment where the demand of steel pipes will increase are construction, petroleum products, water supply and power."

"Although pipes are now available in different materials like cast iron, pre-stressed cement concrete, PVC and others, they cannot match the versatility of steel pipes. In particular, oil and gas transportation are not favoured through any other pipe than steel," said Singh.

The estimated demand for steel pipes in 1998-99 has been put at 371,000 tonne. This is expected to grow further to 407,000 tonne. During the last fiscal, consumption of steel pipes by the construction sector stood at 28,000 tonne, petroleum products at 135,000 tonne, water supply products at 245,000 tonne and power sector and others at 65,000 tonne.