JSW Steel to expand plant by Aug

Company plans to commission second cold-rolled mill to manufacture automotive grade steel set up for Rs 4,200 cr

 

Even as the steady supply of iron ore is still far away, the JSW Steel Limited is all set to complete the expansion at its plant in Karnataka. It is in the advanced stages of commissioning its second cold-rolled mill (CRM-2) to manufacture high-end products like automotive grade steel at Toranagallu in Bellary district in August this year, at least a month ahead of schedule.

With the expansion of the steel plant, its installed capacity will go up to 12.3 million tonnes. Presently, the installed capacity is 10 million tonnes. The CRM-2 will see an investment of Rs 4,200 crore. JSW has collaborated with Japanese steel major JFE for setting up CRM-2, which will be operational in August 2013.

“We are in advanced stages of commissioning the 2.3 million tonne auto-grade steel manufacturing plant in August 2013. We will be the first in the country to manufacture outer body panels for passenger cars,” Vinod K Nowal, deputy managing director, JSW Steel, told Business Standard.

With the commissioning of this plant, the total installed capacity to produce automotive steel will go up to 3.3 million tonnes per annum. The company had invested Rs 1,150 crore to set up the 1 million tonne CRM plant, which is already operational.

“For the last one year, we are working with car makers like Honda, Maruti, Toyota, Ford and Mahindra among others for their approval of our automotive steel. They have partly approved our steel. They are testing our auto-grade steel that we supplied from our existing plant and imported from our technology partner JFE. They have given some approvals and some others are awaited,” Vinod K Nowal, deputy managing director, JSW Steel, said.

JSW Steel already manufactures automotive steel for underbody parts and supplies to car manufacturers. The new CRM-2 will manufacture outer body panels for cars and SUVs.

“There is one particular approval awaited from car makers, and which normally takes about a year. We are hopeful of securing it this year. We expect full-fledged orders from car makers to start flowing in, in a year from now,” Nowal said.

The new capacity will help JSW in meeting the demand of automobile industry for high-end products like dual-phase steel and strip steel as well. Presently, carmakers import an estimated 3-4 million tonnes of auto-grade steel for making outer body panels.

Nowal said the company is also working on a backward integration for the supply of cold-rolled and hot-rolled slabs for automotive use. “The JFE have given us the technology for automotive steel. They will help in selecting equipment, delivering grades of products to cater to all leading automakers. They are also going to charge for the technology they are going to transfer to us for making the auto grade steel,” he said.

JSW Steel presently has a 10 MTPA capacity in Bellary and a 1 MTPA capacity plant in Salem in Tamil Nadu.