Durgapur Steel Plant Gets Nod To Operate At 100%

Steel Authority of India Ltd (SAIL) in its final production plan for the current financial year, has given its unit Durgapur Steel Plant (DSP) the mandate to operate at full capacity in the last quarter of the fiscal.

The remaining integrated plants have been told to plan production against orders. Following a meeting with M K Pandhe, national general secretary of Centre for Indian Trade Unions (Citu), earlier this year, SAIL chairman, Arvind Pande, has given DSP the go-ahead to achieve full capacity during the current fiscal.

The DSP management expects to achieve production levels of over 90 per cent capacity utilisation during December, 1998, and at present the blast furnaces have been producing at 5000 tonne per day.

 

Officials however said, the tempo would receive a drubbing on December 11 due to the proposed countrywide industrial strike.

While DSP has been given the mandate to produce to full capacity, the SAIL chairman has asked the other integrated plants _ Rourkela, Bokaro and Bhilai _ to plan their production for the fiscal against orders. If necessary, these plants may also be required to cut-back production from rated capacity if adequate orders do not materialise, said officials. SAIL has invested about Rs 4,800 crore on modernisation at DSP and the management perception is that while the overall depressing economic scenario has forced heavy rebates on DSP's products, a higher production level would ensure comparatively lower overheads and higher gross margins.

However, despite rebates, DSP has been fortunate to find a market for all its products except skelp which has become an obsolete product with the entry of wide hot-rolled coils. "It is a question of time before DSP phases out its skelp mill", said officials.

DSP's post-modernisation capacity at full utilisation would be 1.8 million tonne of crude steel. The plant also hopes to save Rs 240 crore during the current financial year through cost cutting initiatives.

SAIL officials also said, since there was no hope of a revival in prices of hot rolled coils before the next two years, the other integrated SAIL plants would have to plan their production carefully against specific orders to be able to maintain average net sales realisations.