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Home Blog ‘Tata’s Keen to Invest And Set Up A Downstream Steel Park In Odisha’

‘Tata’s Keen to Invest And Set Up A Downstream Steel Park In Odisha’

  • Published | 18 January 2019
The investment plan by Tata Steel in a downstream park on 300-400 acres in Kalinganagar steel plant of Odisha turns 50% of hot metal into value added steel products, will Propel Crude and Steel Market by 2030.
INDIA: Tata Steel had recently written to the state government conveying its interest in anchoring the proposed downstream park next to its newest greenfield plant currently being ramped up from 3mtpa (million per annum) to an 8mtpa million facility. The Odisha government hopes to see, by 2030, at least half the metal produced in the state further processed and consumed within Odisha, ideally around its existing steel and aluminum hubs.  One of the concerns expressed by the fifteenth Finance Commission, on a recent visit to the state, was why Odisha, which had more than 70% of the country’s minerals, had such a disproportionate and weak contribution in the country’s manufacturing sector? The state government has been on working hard to help address this anomaly, while trying to reduce its dependence on mineral-based earnings. Viewing, its significant competitive strengths in metals, downstream industries in the metal sector has been classified as one of the six focus sectors of Odisha’s 2025 vision plan for industrial development. “We are happy that Tata Steel has conveyed to set up an industrial park in Kalinganagar which will provide a significant boost to steel downstream units. It is currently building a 2.2 million tonnes cold roll mills within its existing 3000 acres at Kalingnagar. The state government is going to engage a consultant shortly for deciding the modalities of the park. The aim is convert at least 50 per cent of the hot metal into finished, value added steel products by 2030." said- Sanjeev Chopra, principal secretary (Odisha Industries). In September last year, the Odisha government has held talks with about 70 steel downstream companies, soliciting their investments. The meet at Kalinganagar in Jajpur district, was attended by several ancillary firms from Odisha as well as states like Jharkhand, West Bengal, Andhra Pradesh, Kerala, and Maharashtra. According to BlueWeave Consulting, Steel production is the largest iron ore application. It is basically an iron alloy along with carbon, and other additive metals such as boron, manganese, nickel, titanium, chromium, molybdenum, and vanadium, these additive metals impart different characteristics to steel in order to make it suitable for multiple applications. India is the world’s third-largest steel producer and third-largest steel consumer. The growth in the Indian steel sector has been driven by domestic availability of raw materials such as iron ore, cost-effective labour, rising disposable income, rapid urbanization, and increase in population. This trend is presumed to continue over the forecast period, and thus, assist the regional market in the near future. The Indian steel industry is very modern with state-of-the-art steel mills. It has always strived for continuous modernization and up-gradation of older plants and higher energy efficiency levels. Odisha is home to leading steel makers like Tata Steel, Jindal Steel & Power Ltd (JSPL), Bhushan Steel and Jindal Stainless which are few manufacturers. The set-up of downstream park has the potential to create employment for thousands of people. According to BlueWeave Consulting, upcoming report, Tilted-“Indian Steel Market, By Market Size, By Product (long steel and flat steel), By Application (Construction, Heavy Industry, Transportation, Consumer Goods), By Region (North, South, East, West), And Segment Forecasts, 2018 – 2025”.  Although Odisha produces nearly 22 million tonnes of steel each year, hardly 10 per cent is consumed within the state due to improper utilization. Developing steel with superior characteristics that meet the customer specifications is another key area that is expected to promise abundant scope for rapid growth and development. This will bring  opportunities for downstream and ancillary industry exist in areas like equipment manufacturing, foundries, flat and cold rolled products, fabrication, machining and precision equipment, appliances & white goods, auto components, fasteners, and kitchenware. Moreover, rising preference for utilization of alloys in consumer goods is expected to drive the steel industry. According to BlueWeave Consulting’s upcoming report, Tilted-“Global Steel Market, By Market Size, By Product (long steel and flat steel), By Application (Construction, Heavy Industry, Transportation, Consumer Goods), By Region (North America, Asia Pacific, Europe, Middle East & Africa, China), And Segment Forecasts, 2018 – 2025”. Global iron & steel market is expected to witness rapid growth owing to strong demand from construction and transportation sector over the forecast period. Rapid industrialization and urbanization, particularly in the emerging regions such as Asia Pacific and Central & South America are expected to drive the overall steel market. Major iron and steel producing countries are China, India, Brazil, Japan, Australia, South Korea, Germany, and Ukraine.  Asia Pacific is estimated to witness fastest growth rate and is thus poised to dominate the global market. Widespread application in heat exchangers, gas heaters, air handling units, and several other cooling, ventilation, and heating components are likely to propel Steel market growth over the forecast period. In addition, it is an excellent material for commercial, industrial, and residential HVAC applications. Major industry participants in the iron & steel market include Bridon International Ltd., ArcelorMittal S.A., Kobe Steel Ltd., Insteel Industries Inc., N.V. Bekaert SA, Steel Authority of India Ltd. POSCO, Tata Steel Ltd., Rio Tinto, BHP, Vale, Tree Island Industries Ltd., and Leggett & Platt Incorporated.