Over the medium term from 2023 to 2027, it is estimated that the demand from Indian will increase to 263Mtpa, at a CAGR of 7%. The structure of the steel industry in India is undergoing a rapid transformation as part of the industry’s expansion, such as ‘Make in India’ campaign to meet 2030 capacity targets.

Over the long term, iron ore demand will grow at a CAGR of 5.7%, to reach 540Mt in 2040, driven by demand for pig iron as well as by DRI production. Under the government’s steel production strategy, the industry will shift from being dominated by small-scale EAF and IF producers to being dominated by mega-integrated steel mills, utilising multiple technologies, owned by the country’s five largest steel producers.

Although EAFs currently account for a majority of production, they are reliant on ore-based metallics, including cold pig iron and sponge iron, due to a lack of scrap availability in the country. Increasingly, AME expects many of the brownfield expansion projects to increase their use of hot metal directly into EAFs, which will see the share of BOF refined steel grow more slowly than the ramp-up of pig iron production might suggest.

India has pledged to reduce the carbon intensity of their economy by 40% and reach 500GW of renewables by 2030. It also pledged to carbon neutral by 2070. ‘Green New Deal’ is a possible roadmap for India’s net-zero transition.

In past decades, unsustainably low domestic prices for raw materials such as iron ore and coal helped drive the country’s high growth rates. India’s per capita energy use today is lower than most nations. Its use of materials such as iron ore is still modest.

The government has now imposed a 50% tax on iron ore and concentrates, non-agglomerated and agglomerated, implying that all grades will now be subject to the higher duty. The government said that iron ore pellet exports are now taxed at 45%, while it was previously exempt from tax. In the meantime, the government has waived customs duties on the import of some raw materials, including coking coal and ferronickel, to reduce costs for the domestic industry.

JSW Steel

Indian steel producer JSW Steel has commenced operations of its sinter plant #2 at Bhushan Power and Steel Ltd (BPSL), Rengali-Sambalpur, Odisha state. The commissioning forms part of the company's plan increase crude steel capacity by 3.5Mtpa. By the beginning of the 2024 fiscal year BPSL's expansion will reach 5Mtpa capacity, with the steelmaker having ordered the PCI systems for two blast furnaces and additional meltshop and a wire rod mill.

Future expansion plans at the facility are to increase crude steel capacity to 15Mtpa with investment of US$7.45bn. The JSW Steel will soon launch a 0.25Mtpa tinning line #2 at Tarapur plant and a continuous annealing line at Vasind plant in Maharashtra state. From July – September 2022, JSW Steel plans to begin the phased commissioning of a coking plant with a capacity of 1.5Mtpa. The project will continue with adding another 1.5Mtpa coke plant during the next financial year.

Tata Steel

Tata Steel plans to more than double its crude steel capacity from 20Mt to 42Mt over the next 10 years. During the past few years Tata Steel has grown inorganically via acquisitions, with new growth of around 22Mt can be achieved at its existing sites.

The recently acquired Neelachal Ispat Nigam will have production expand to a crude steel capacity of 10Mt from its current 1Mt. Meanwhile, the Kalinganagar steel complex will expand its crude steel capacity from 3Mt to 8Mt, with medium term plans for expansion to 16Mt.

India steel producer Tata Steel will need to invest US$126m to restart its newly acquired Neelachal Ispat Nigam Limited (NINL) during the next three months. Ownership of 93.71% was transferred to Tata Steel’s subsidiary Tata Steel Long Products Limited (TSLPL) in July this year via the government’s privatisation process. It is expected half of the capital expenditure require to restart operations of the closed mill will be invested in the current fiscal year.

Tata Steel will commit further investment to ramp up crude steel production to 4Mtpa by 2026 from its current 0.9Mtpa. The company will start the blast furnace in November 2022, and other facilities thereafter which is expected to take six months. The coke ovens and other steelmaking operations were shut down in March 2020 due to ongoing financial losses. 

Tata Steel has signed a memorandum of understanding with the government to construct a new scrap-based electric arc furnace (EAF) mini mill in Punjab state. The company has been allotted a 0.47km2 site in Kadiana Khurd Industrial Park in Ludhiana.

Investment in the project will be approximately US$340m. The EAF mini mill will have a 0.75Mtpa crude steel capacity and produce construction grade steel rebar under the company’s brand ‘Tata Tiscon'. Tata Steel suggests Punjab is the ideal location for an EAF due to proximity to the local market and scrap-generating automotive hub.

SAIL

SAIL's crude steel capacity for 2021 was approximately 21Mt, with 50Mt forecast by 2030. The majority of this expansion is expected to come from five of the company’s steel facilities, Bhilai, Durgapur, Roukela, Bokaro and IISCO, which will account for total crude steel capacity expansion of 28Mt.

SAIL has held a groundbreaking ceremony for a new slab continuous casting machine (CCM) #4 and an additional ladle furnace (LF) at Rourkela Steel Plant (RSP) in Odisha state. The capacity of the slab will be approximately 1Mtpa and have capabilities to produce 210-250mm thick, 1,050-1,850mm wide and 6,000-10,500mm long slabs.

Once operational, the caster will be capable of producing semis of commercial and value-added grades to manufacture finished products suitable for the oil and gas, automotive and other various industries. The project is scheduled for commissioning in May 2025. SAIL has plans to increase the sites crude steel capacity of 4.3Mt, to 8.8Mt by 2030.

AMNS India

ArcelorMittal Nippon Steel (AMNS) India will acquire Essar Group’s port and power infrastructure assets for US$2.4bn. The two companies have signed a definitive agreement and will support AMNS India’s steelmaking facility located in Hazira, Gujrat state. The agreement includes an equal joint venture partnership to build a 4Mtpa capacity liquefied natural gas terminal at Hazira. The ownership of the port assets has been in the courts since December 2020.

ArcelorMittal and Nippon Steel acquired to the steelmaking assets for Essar Steel of US$5.7bn in December 2019 under the Insolvency and Bankruptcy Code. The transaction will be fully funded by AMNS India, with agreement of the assets that are captive, which includes ports assets in Gujarat, Andhra Pradesh, and Odisha. This were not part of the insolvency resolution process for Essar Steel. The signing marks a significant milestone as the facility aims to expand its crude steel capacity from 10Mtpa to 18Mtpa by 2030.

AMNS has made its investment decision in upstream and hot rolling capabilities. New equipment for ironmaking will include two blast furnaces, two sintering machines and three coke ovens. While its steelmaking process will have new facilities of three basic oxygen furnaces, two continuous casting machines, along with a new hot strip mill. Investment in the project will require US$5.63bn and will add 6Mtpa of crude steel capacity and implement in two phases.

Phase one, will be commissioned in mid-2025 and include blast furnace #2 and related steelmaking equipment. While phase two, will be commissioned in mid-2026 and include blast furnace #3 and related steelmaking facilities. The India government has maintained its support for infrastructure development and promotion of manufacturing industries.

AMNS India will also acquire port related and power related infrastructure companies. Port assets include Essar Bulk Terminal Ltd, Essar Bulk Terminal Paradip Ltd and Essar Vizag Terminals Ltd. Acquired power assets will be Essar Power Hazira Ltd, Essar Power Ltd and part a business of Essar Power Transmission Company Ltd. Total acquisition cost of port and power assets are expected to be US$2.4bn.