MALAY CHATTERJEE CHAIRMAN-CUM-MANAGING DIRECTOR KIOCL LIMITED BANGALORE, INDIA

Transcription

1 MALAY CHATTERJEE CHAIRMAN-CUM-MANAGING DIRECTOR KIOCL LIMITED BANGALORE, INDIA 1

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3 India is the 4 th largest crude steel producer (83 Mt in 2014) in the world after China, Japan & US with a production capacity of around 101 MTPA. Steel sector contributes to around 2% of GDP, employs over 600,000 persons. Per capita steel consumption in the country is currently estimated at 60 kg against World average 236 kg : scope to increase consumption. Steel production has been growing at a rate of (CAGR) 7.9% since

4 Qty n Mn T Crude Steel Production 4

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6 Steel industry affected by sluggish growth with 2.2% in consumption during Imports to India surged by 75% during 2014 due to surplus global steel capacity (300 Mt) and fall in International prices. Growth in world apparent steel consumption was only 0.6% in In China, there was a negative growth in apparent steel consumption by -3.3% during

7 Industry faced inadequate supply of iron ore due to statutory reasons which forced the industry to import the iron ore. Threat of cheap imports from China followed by Russia, Ukraine, Japan etc. China saw use of the steel falling 3.4% during 2014, and sold 51% more steel at m tonnes in the world market in Saddled with surplus capacity & poor demand, China stepped up exports to India by as much as 232% to Mt in

8 Major portion of iron ore available in abundance is of medium grade ( Fe 58% 63%). Extremely high logistic cost of iron ore movement as most of the mines are land locked. No dedicated Railway network for transportation. Many of the new steel plants do not have captive mines. Other issues - power & gas shortage, environmental issues. 8

9 Qty n Mn T (e) (e) Export ( Semi/Finished) Import (Semi/Finished) 9

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11 Apparent steel consumption in Mt up by 2.2% y-o-y. Growth in consumption expected to increase by 6.2% (80 Mt) in 2015 and 7.3% (85.8 Mt) in 2016 as against projected growth in the world by 0.5% & 1.4% respectively. Govt. of India stepping up infrastructure spending from 5% to 10% of GDP by Steel production capacity is planned to be scaled up to 300 MTPA by Mining output set to improve as legal hurdles are being cleared. 11

12 Qty in Million Tons Source: Report of the working group on steel industry 12 TH plan and SAIL Vision

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14 Pelletization is set to achieve multi-fold growth as India seeks to achieve ambitious target of 300 Mt of Steel by year The Pellet production capacity which was 20 Mt in 2010 has now crossed 90 Mt/annum. Merchant capacity is about 60% plants. and rest is captive Most of the steel plants having captive cum merchant pellet plants. DRI plants prefer pellets while BF units prefer sinter & lumps in India. 14

15 All most all the BF units under Pvt. sector installed captive Beneficiation cum Pellet plants. have Other mills under public sector are under process of setting up Beneficiation cum Pellet plants. With slow growth in steel production, there is surplus pellet capacity. However with International iron ore/pellet prices dipping below domestic rates, the imports are on the rise. Indian DRI plants have successfully stabilized the use of BF grade pellets & lumps in their reactor. 15

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17 Iron ore requirement in India is around 170 Mt. Sinter capacity - 65 Mt, Lump production - 36 Mt, sponge capacity 45 Mt, pellet capacity- 90 Mt. There is surplus capacity of pellets almost double the demand at present. Most of the pellet plants are running below 50% capacity. The surplus pellet availability along with cheaper imports of high quality lumps in large quantities have resulted in poor demand for domestic pellet. Demand for pellet is derived as it is the costliest among inputs. Pellets are imported whenever economically viable. 17

18 Qty n Mn T Qty n Mn T FY11 FY12 FY13 FY14 FY15(e) Capacity Export Import 18

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20 (In Million Tonnes) GRADE RESERVES RESOURCES TOTAL Hematite Magnetite Total (Source: Indian Bureau of Mines, Ministry of Mines as on 01 APR 2010) Iron ore deposits of BT [17.88 BT - Hematite & BT - Magnetite] are the 7 th largest in the world. Magnetite resources not fully explored for reasons that :- - mostly found in eco-sensitive areas, - requires huge investment, - disposal of slime etc. 20

21 About 70% of production is in form of fines & balance is lumps. To utilise the fines, Govt. has encouraged setting up of beneficiation and pellet plants. Embargo on mining in a few Indian states by the Govt. resulted in drop in Iron ore output to 125 Mt in FY13-14 from 204 Mt in the FY Exports from India touched a high of 117 Mt in 2010 & low of 15.1 Mt in due to very low International prices, huge duties, logistics etc., Globally, the steel industry is witnessing a slowdown in steel demand. Govt. of India plans 300 Mt of Steel production by 2025 & requires 500 Mt of Iron ore annually. 21

22 Govt. of India has implemented MMDR Amendment Act 2015 to streamline mining activities. Indian laws under MMDR Act 2015, facilitates allocation operation to Iron & Steel Industry. Production capacity is expected to be > 250 Mt by 2020 will encourage investment in Iron & Steel industry. 22

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24 The import of iron ore (IOF,IOL,IOP) has touched all time high of 15.5 Mt during up from 0.4 Mt during previous year due to the ruling of laws. Iron ore production in India declined to 125 Mt in from 152 Mt in the previous year due to prevailing legal embargo; increasing imports etc. With International iron ore prices dipping below domestic prices during , imports have increased. Outlook for domestic mines is very bright due to continuous increase in steel capacity and changes in Indian Mining laws. 24

25 Qty n Mn T Qty n Mn T FY11 FY12 FY13 FY14 FY15(e) Production Export Import

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28 Make in India is an initiative of the Govt. of India, to encourage companies to manufacture their products in India and was launched by Hon ble Prime Minister on 25 th Sept It offers incentives, benefits & supporting infrastructure to manufacturers. KIOCL plans to convert its merchant pellet plant into Tolling pellet plant by taking advantage of its excellent Infrastructural facilities. KIOCL s proximity to Middle East / Iran market has generated interest in tolling with Iron Ore Companies. In Tolling, KIOCL will provide a platform for the overseas customer to Make Pellets in India using its iron ore fines / concentrate and take it back as pellets. 28

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31 Schedule A Miniratna Category- I, 100% EOU CPSE under Administrative control of Ministry of Steel. Accredited with ISO-9001:2008, ISO-14001:2004 & OHSAS :2007 Certifications for International Standards. Established on with core objective for Mining & Beneficiation of low grade Magnetite Iron Ore at Kudremukh mine. Set up the first Pelletisation Plant in the country with a capacity of 3.5 MTPA in In 2001, ventured into production of Pig Iron of capacity MTPA under JV later merged with KIOCL w.e.f

32 Pellet Plant designed to handled magnetite iron ore successfully migrated to hematite iron ore with in-house R&D. Engaged in the business of high quality Iron Oxide Pellets and Pig Iron. Presently catering to domestic steel mills and in export market to China, Middle East, steel mills of Iran. Track record of making consistent Profits and dividend. paying 32

33 The Pellet Plant at Mangalore produces High Quality iron Oxide pellets. The Plant has following facilities. Pressure Filters Pelletizing Discs Roller Screens Indurating Machine The pellets are reclaimed through a pellet reclaimer of capacity 6000 TPH and loaded into ships through a ship loader with a rated capacity of 6000 TPH. A loading rate of 30,000 to 40,000 tonnes a day is guaranteed for Panamax type vessels. 33

34 A captive iron ore berth has been provided to handle ships of 65,000 DWT with a loaded draft of 12.5 meters. This exclusive berth eliminates waiting time for ships. Iron ore fines received from outside sources are ground and stored in sheds as a stockpile having a capacity of 4.0 lakh tonnes. 34

35 KIOCL is the first shore based Pellet Plant (100% EOU), having captive berth & highly mechanised loading system. All-weather port with on arrival berthing facility. The only plant which can process Magnetite or Hematite ore. Output as per International standards & suits both BF or DR grades Provision for duty free imports of raw material. Highly experienced technical manpower can process the ore as per customer requirement. Low cost of conversion with respect to quality of fines. Recycle of pellet fines to achieve fines to pellet ratio 1:1 35

36 KIOCL is also interested to enter into tolling agreements wherein KIOCL can convert imported ore/concentrate into pellets & supply back to the customer. The pellet feed required for pellet production is : Hematite (Fe 2 O 3 ) or Magnetite (Fe 3 O 4 ) Size:- 325 Mesh (65 to 70%) = 45 micron =0.045 mm (+ 100 # to be < 5 %) Blaine Number ~ 1600 (cm2 /gm) Moisture not to exceed : 9 10 % 36

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