Rashtriya Ispat To Export 2 Lakh Tonnes Of Pig Iron

Disclosing this to Business Standard here yesterday, RINL's Visakhapatnam Steel Plant chairman and managing director, Jitendra Mehra, said the present distortion in the domestic steel market could largely be traced to the free availability of pig iron this year, with the Steel Authority of India alone having a stock of over 400,000 tonnes.

The entire steel industry has been banking on Vizag's initiative to rectify the market. If we do not export the pig iron but bring it to the domestic market, the industry will be in a crisis, he said.

Mehra said RINL had placed 400,000 tonnes of pig iron in the international market last year as against 100,000 tonnes in the first half of the present year. The plant will export another 200,000 tonnes of pig iron between October and December this year, which it was holding at present. This will take care of the market imbalance, he said.

 

The RINL Chief maintained that export of pig iron was not a remunerative proposition, but the company decided in favour of the same to bring a semblance of balance in the domestic market.

He maintained that the demand shortfall in the steel market was only a seasonal distortion and would blow over in a months time. He attributed this to a heavy inventory build up in China, lack of investment decisions in the immediate past, pending consolidation of the new government, low demand for construction steel and lack of money flow in the market. However, he felt the situation would improve now.

He agreed that part of the problem was the possible dumping by the CIS countries in the Indian market. This was, however, difficult to establish. The dollar/rouble parity and the need for Russia and CIS countries for hard currency makes it easier for them to export steel into the Indian market.

Revision in tariffs in the last budget and a price slump in the international market also led to a surge in the flow of foreign steel in the Indian market.

Mehra said the Indian whitegoods industry had not come up to the projection and consumption of steel made by the steel industry through the automobile industry, has gone on a spin. To avoid such distortions in future, the RINL Chief felt that future projects of market demand should be based on the global market rather than the domestic market. This is a fresh thought that should go into our future planning, he said, adding that in such a situation, a dip in the domestic market will not shake up the industry.

When the Visakhapatnam Steel Plant (VSP) was conceived, it was meant only for meeting the domestic demand.

It was port-based to help import raw materials, especially coal.