SUMMER TRAINING PROJECT REPORTONEXPORT POTENTIAL OF STEEL
BILLETS AND HOT ROLLED COIL IN MENA AND SOUTH EAST ASIAN REGION
Undertaken at
Submitted for the Partial fulfilment of the requirementTowards
the award of Degree ofMaster of International Business (MIB)Session
2011-13Submittedby
Under the Supervision of Mr. VINOD KUMAR SINGHAL AGM, (M-ITD),
SAIL
CENTRE FOR MANAGEMENT STUDIES JAMIA MILLIA ISLAMIA New
Delhi-110025
DECLARATION
I, .., a bonafide student of MIB (Full Time) Programme at the
Centre for Management Studies, Jamia Millia Islamia, New Delhi,
hereby declare that I have undergone the Summer Training at STEEL
AUTHORITY OF INDIA LTD, INTERNATIONAL TRADE DIVISION, India under
the supervision of Mr. Vinod Kumar Singhal on export potential of
Steel Billets and Hot rolled coil in MENA and South East Asian
region
I also declare that the present project report is based on the
above summer training and is my original work. The content of this
project report has not been submitted to any other university or
institute either in part or in full for the award of any degree,
diploma or fellowship.
Further, I assign the right to the university, subject to the
permission from the organization concerned, use the information and
contents of this project to develop cases, case lets, case leads,
and papers for publication and/or for use in teaching.
ACKNOWLEDGEMENT
I am heartily thankful to my supervisor Mr. Vinod Kumar Singhal,
AGM, (Marketing-ITD), whose encouragement, guidance and support
from the initial to the final level enabled me to develop an
understanding of the project .It is his support and guidance due to
which I remain able to come out with this project report.
I owe the highest sense of appreciation for the talented,
Cooperating and hardworking team of SAIL (ITD) especially Mrs.
Shanta Rao, DGM (Marketing-ITD) and numerous other officials
including Mr. Rohan Singh Meena, Jr. Manager (M-ITD), SAIL and Mr.
S.M. Razi, Jr. Manager (M-ITD) SAIL for cooperating during the
Internship and for providing me the most valuable comments and
suggestions without which this report might not have been
complete.
I also wish to express my gratitude to the management of
SAIL-INTERNATIONAL TRADE DIVISION, who rendered their help during
the period of my project work.
Last but not least I wish to avail myself of this opportunity,
express a sense of gratitude and love to my friends and my beloved
parents, specially my mother for their immense support, strength,
their faith in me and for everything.
EXECUTIVE SUMMARYSteel Authority of India Limited (SAIL) is the
leading steel-making company in India. It is a fully integrated
iron and steel maker, producing both basic and special steels for
domestic construction, engineering, power, railway, automotive and
defence industries and for sale in export markets. SAIL is also
among the five Maharatnas of the country's Central Public Sector
Enterprises.
SAIL manufactures and sells a broad range of steel products,
including hot and cold rolled sheets and coils, galvanised sheets,
electrical sheets, structurals, railways products, plates, bars and
rods, stainless steel and other alloy steels. SAIL produces iron
and steel at five integrated plants and three special steel plants,
located principally in the eastern and central regions of India and
situated close to domestic sources of raw materials, including the
Company's iron ore, limestone and dolomite mines. The company has
the distinction of being Indias second largest producer of iron ore
and of having the countrys second largest mines network. This gives
SAIL a competitive edge in terms of captive availability of iron
ore, limestone, and dolomite which are inputs for steel
making.SAIL's wide range of long and flat steel products is much in
demand in the domestic as well as the international market. This
vital responsibility is carried out by SAIL's own Central Marketing
Organisation (CMO) that transacts business through its network of
37 Branch Sales Offices spread across the four regions,25
DepartmentalWarehouses, 42 Consignment Agentsand 27 Customer
Contact Offices. CMOs domestic marketing effort is supplemented by
its ever widening network of rural dealers who meet the demands of
the smallest customers in the remotest corners of the country. With
the total number of dealersover 2000, SAIL's wide marketing spread
ensures availability of quality steel in virtually all the
districts of the country.SAIL's International Trade Division (
ITD), in New Delhi- an ISO 9001:2000 accredited unit of CMO,
undertakes exports of Mild Steel products and Pig Iron from SAILs
five integrated steel plants.The research has been carried out to
Estimate the Export Potential of steel billets and Hot Rolled coil
with focus on MENA (Middle East & North Africa) and South East
Asian region. The report is based on the desk research methodology
.The study covers the annual imports, exports, consumption and
future demand of the respective products in the regions.
The Middle East and North Africa (MENA) region is considered
currently a key growth markets for the steel industry at the
consumption and production alike due to the fast-expanding
construction & fabrication sector. It has witnessed major
transformations over the past years, as Arabian countries try to
emerge from the shadows of the developed world and become more
industry oriented.The Middle East and North Africa (MENA) remains a
source of high demand for steel, which continues to outpace the
rest of the world. Meanwhile, a persistent trend of recycling high
gas and oil prices into construction and capital investments in the
region continues to serve fast-growing, increasingly wealth
populations. These trends have been in place for nearly a decade
now as a result supply is being developed to meet the higher levels
of demand. Nonetheless, external suppliers remain important players
as they fulfil over one-third of demand generated in the MENA
region.Over the past couple of years, the steel industry worldwide
has been experiencing stunning growth and the Middle East has
flourished to become major players in the steel market. The real
estate sector has been at the heart of the demand, as this sector
witnessed tremendous activity. Consequently, steel companies in the
MENA region entered 2008 strongly, pushed by their momentum and
massive profits achieved in the previous year. In 2007, Egypt and
Saudi Arabia ranked 27th and 35th, respectively, among the worlds
steel producing countries and in 2010, Egypt and Saudi Arabia
ranked 24th and 28th respectively. And in 2011 Egypt and Saudi
Arabia ranked 24th and 27th respectivelyThere are 67 steel plants
in the Arab region. The demand for steel is rising at five to six
per cent every year.The MENA region is considered to be among the
top five locations in the world to establish a steel factory, due
to a favourable demand ,congenial environment and relatively cheap
energy prices.The Egyptian steel industry represents one of the
cornerstones of Egypts economic growth and development, due to its
linkages to almost all other industries that stimulate economic
expansion. Steel is everywhere, in construction, housing,
infrastructure, consumer goods and automotive industry, all rely
heavily on the steel industry and so, the importance and
development of the steel sector is imperative for the progress of
the Egyptian economy in general.Egypt is definitely playing a key
role as a major producer of steel in the Middle East & North
Africa. In a ranking of 59 countries, "FDI Intelligence" ranks
Egypt 2nd in Africa with regard to Foreign Direct Investment (FDI)
in FY 2010/11. This affected on the growing of the steel industry
in Egypt.The political uprising in MENA region has certainly
affected the business but there is a bigger opportunity for
Exporters to MENA region as the governments of Kuwait, Kingdom of
Saudi Arabia and Republic of Syria has announced the Billions of
dollar packages of developments to suppress the dissent in
protestors even by distributing cash subsidy and money to buy homes
for them which will boost the demand for housing and infrastructure
sectors once again in MENA region. Kingdom of Saudi Arabia has
allotted US $ 6 billion for housing projects for enabling people to
buy home.
Morocco was ranked 3rd, Sudan 15th and Ethiopia 10th by Grail
Research among African nations in Steel producing capabilities. The
Sudanese iron and steel industry begancontributing to meeting the
growing domestic needs of the iron and steel products represented
in the reinforcing steel, wire rods and tubes and pipes. This
industry has seen its start-up in concurrence with founding Giad
industrial city established by the Sudan Master Technology Company.
The annual production capacities are estimated by 60 thousand tons
of crude steel, 150 thousand tons of long products and 140 thousand
tons of pipes. Sudan Master Technologies Company completed the iron
and steel complex consisted of two mills, the first specialised in
billets production with a capacity of 60 thousand tons per year,
which comprises one electric arc furnace, and one Ladle furnace to
receive the molten metal with the capacity of 25 tons charge. The
second mill is specialised in reinforcing steel production of a
range of 8 25 mm diameters, angles of 25 to 50 mm sizes and 3-4 mm
thickness, and flats with 16-60 mm sizes and 3-10 mm thickness.The
investment value in this mill is 38 million U.S dollars. It employs
130 workers, engineers and administrative personnel. It extends
over an area of 33 km2.The production of crude steel of MENA region
has risen by 13% in 2010-2011.This is also due to the upcoming
football world cup in 2022 in Qatar and the proposed housing
projects by many Arab nations.South-East Asia South East Asias
appetite for steel is expanding more rapidly. The region comprises
several countries whose economies are growing and changing, and it
is well located on major seaborne trade routes. It also has
free-trade agreements in place with over half of the worlds
population the steel industry in ASEAN registered a double digit
growth of 16.8% in 2010, mainly due to the high growth rates in
Indonesia, Malaysia and Thailand. The integration of Southeast
Asias economies into a single production base, the ASEAN Free Trade
Area (AFTA), is yet another attraction of the region as tariff
barriers are eliminated among its member countries. As far as the
production is concerned the Malaysia was ranked 26th with
production of 5.7 million tonnes of steel in 2010, and in 2011
Malaysia remained at the same position that is 26th with production
of 6.0 million tonnes of steel. Vietnam was ranked 32nd in both the
year 2010 and 2011 with the production of 4.3 and 4.6 million
tonnes of steel respectively. The position of Thailand was changed
from 34th to 33rd from 2010 to 2011, with the production of 4.1
million tonnes and 4.4 millions tonnes of steel respectively
Indonesia was ranked 37th in both the years that is 2010 and 2011
with production of 3.7 million tonnes and 3.8 million tonnes of
steel Preliminary data compiled by SEAISI revealed that apparent
steel consumption in ASEAN expanded by 4% y-o-y to 50.5 million
tonnes in 2011. Singapores steel consumption surged significantly
by more than a million tonnes to 3.8 million tonnes in 2011.
Surprisingly, Thailands steel consumption increased by 3% y-o-y
amidst the severe flood situation and the economic slowdown in the
country. Steel consumption in Indonesia and Philippines rose by 8%
to 9.7 milliion tonnes and 4.3 million tonnes in 2011,
respectiviely. On the other hand, Malaysia and Vietnam both
experienced declines in steel demand. Malaysias steel consumption
of 8.05 million tonnes in 2011 was a decline of 3.2% y-o-y while
Vietnams tight monetary and fiscal policies slowed down its
domestic steel demand to 10 million tonnes, a decline of 5.4%
y-o-y. South east asian region are the net importer of the steel as
the production is far less than the demand infact the top 15 net
importer of steel in the world, according to world steel
association, is comprises of six nation of the south east Asia. In
year 2011, Thailand ranked 2nd largest net importer of the steel in
the world with import of 10.9 million tonnes, Vietnam ranked 3rd
with net import of 8.3 million tonnes, whereas Indonesia occupied
the 5th position with net imports of 7.3 million tonnes,
Philippines 9th with 3.8 million tonnes of net imports, Singapore
ranked 10 with 3.1 million tonnes of net imports and Malaysia
ranked 15th with 2.6 million tonnes of net imports We can see that
a large portion of net importer is occupied by the south east asian
region that shows that there is an immense export potential of
steel in south east asia
CONTENTS CHAPTER 1 1.1 Export potential of product: a brief
background of issues 9 1.2 Export potential of product of sail
10
1.1 EXPORT POTENTIAL: A BRIEF BACKGROUND OF ISSUES Export
Potential involves studying, analysing the actual potential of a
Product in an International Market. Export Potential involves doing
a complete market research on a prospective market. It is through
International Market Research that a Potential of a product is
estimated and then implemented. The techniques or methods of
estimating the export potential are, by and large, the
same/familiar for different markets but these may have to be varied
depending upon the market characteristics, the time and money to be
spent and the availability of data or information. Export potential
is a highly technical and scientific activity, requiring good
planning and methodology to find out the accurate information on
the market.EXPORT POTENTIAL COVERSEstimating the Export Potential
usually involves the following attributes:A. Exporting Country
Trade Regulations.B. Market Access covering tariffs and Quotas,
internal taxes, currency restrictions, health and political
factorsC. Market Size covering production, imports, exports,
consumption, derived demand and market segmentationD. Factors
affecting demand such as economic , climate, geography, social and
cultural factorsE. The most important and foremost is the level of
CompetitionF. Product research covering such as packing for
shipment and the product pack.G. Marketing Practices covering such
as Transport logistics, Sales and Distribution, Pricing etc
RESREARCH TECHNIQUES OF ESTIMATING EXPORT POTENTIALThe numbers of
research techniques are used for appropriate information for export
marketing. Different methodology is employed according to the
objective and scope defined for research.Basically there are two
methodsA. Desk Research or Secondary ResearchB. Field Research or
Primary ResearchDESK RESEARCH/SECONDARY DATADesk or secondary
research is the search for information from relevant data already
available. The data could take the form of information from
censuses or information readily available from industry and trade
directories.A. Desk Research uses secondary data from:B. Internal
sources i.e. company itselfC. External sources using libraries of
industry and trade associations, chambers of commerce, export
promotion organizations, international bodies such as International
Trade Centre, Geneva, CBI, Holland etcD. Internet sites of various
agencies/organizations such as ITPO,WTO,IMF,ITC etcE.
Publications(books, magazines, journals, newspapers)F. Market
study/survey reportsG. Trade delegation reportsH. Catalogues of
MNCs or leading world manufacturersI. Company profilesJ. Market
intelligence reports FIELD RESEARCH OR PRIMARY RESEARCHField
research is employed to collect primary data by:A. Observation
methodB. Survey methodField Research focuses on consumer or buyers
motives (e.g. Why they will buy your product instead of your
competitors product), which forms the basis of the positioning
strategy.The process of conducting field research in estimating the
export potential includes1. visiting the researcher own country2.
Visiting potential overseas markets which involvesA. Planning of
visitsB. Seeking /making appointments with target
companies/organizationsC. Field research in exhibitions/trade fairs
which involves Right TimingD. Questionnaire1.2 EXPORT POTENTIAL OF
PRODUCTS OF STEEL AUTHORITY OF INDIA LIMITED: A BRIEF
BACKGROUNDSteel Authority of India Limited exports its Steel
Products through its International Trade Division. International
Trade Division (ITD) of SAIL at New Delhi an ISO 9001:2000
accredited unit of CMO, undertakes exports of Mild Steel products
and Pig Iron from SAILs five integrated steel plants. SAIL from
time to time conducts International Marketing research for
estimating Export potential of its Steel Products. SAIL maintains a
close liaison with various information agencies, bodies,
organizations for extracting a relevant PRODUCT-MARKET match. ITD
is vigilant in meeting the demands of its global customers; ITD
maintains a close liaison with customers and the production units
to cater to the customized requirements of its customers both in
terms of quality and sizes. ITD exports its product through Vizag,
Vishakhapatnam, Haldia, Paradip ports.ITD exports steel products
mentioned below via its joint venture service centreA. Rails,
Structurals, Merchant Products, Wire Rods, Re-bars, Plate Mill
Plates, Hot Rolled Coils, B. Hot Rolled Plates / Sheets, Cold
Rolled steels, Chequered Plates, Slabs, Billets and Pig
Iron.JUSTIFICATION OF MARKET RESEARCHSAIL is the largest steel
producer in India and has a good presence in International market
too. But the total export of SAIL last year was a less than 3% of
their total sales (Rs 1100 Cr aprox.) Demand/Imports of steel
products in MENA region is 40 Million Ton a year. Exports are not
commensurate with the potential that the MENA region possesses.
Similar is the case with south east asian region, where there is
huge potential for export but also export does not commensurate
with the demands, secondly south east asia is highly developing
market for steel, shoeing a huge potential for the steel. It is
against that background that a Market research has been done to
understand the region demand, competition and imports so that
appropriate export policies can be framed to increase market share
of SAIL product. 1.3 OBJECTIVES OF RESEARCH STUDY1.3.1 TO STUDY THE
EXPORT POTENTIAL OF BILLETS AND HOT ROLLED COILS WITH FOCUS ON MENA
REGION AND SOUTH EAST ASIAN REGION A. To study the world steel
market scenario B. To study the Indian steel industry with focus on
the plant capacity expansion and future prospectsC. To study the
SAILs plants details, production, product line, industry
performance, capacity expansion and CSR D. To study the role of ITD
and CMO E. To study the product (billets and HR coil) information
with focus on world steel trends F. To study the export potential
of billets and HR coil with focus on MENA regionG. To study the
export potential of billets and HR coil with focus on South
EastAsian region1.4 SCOPE OF STUDYThe research study covers the
Export Potential of billets and HR coil in MENA and South East
Asian region. The study looks into the competition patterns of both
the products globally as well as regionally. The study also covers
the duty structure of both the products in prospective markets. 1.5
RESEARCH METHODOLOGYThe data for determining the Export Potential
was based on secondary research and was entirely a desk based
research. The data was collected in combination of literature
search and analysis. Data from secondary sources such as research
papers, internet and magazines was collected. The raw data were
tabulated, processed and analyzed using the appropriate statistical
techniques such as percentage averages, Co-relation values and
presented in the form of Bar Chart in the light of clarity obtained
in the course of the type of data encountered. DATA COLLECTIONThe
present study has made the use of the following sources of
secondary study:1. Iron and steel bulletins such as Metal
Bulletin.2. Relevant books, Magazines, newspapers such as Hindu,
Economic Times3. Relevant public records and statistics, historical
documents and other sources of public information related with iron
and steel trade4. Relevant websites of international organizations
such as WTO, IMF, ITC 5. Information from within Steel Authority of
India Limited6. Government websites such as Customs Australia, DGFT
India, DGCI&SThe sources for unpublished data are many, for
example relevant data may be available with scholars and research
workers. However, these sources are not easy to access and need a
lot of persuasion and lot of time. The researcher has not used such
resources given the limitation of time available. The researcher
has made used secondary data in formulation of research problem and
identification of research objectives. Due care was taken to assess
such data for its suitability for the study, because many such
secondary data was found to be irrelevant to the research problem
as also inadequate in the context of the problem which researcher
want to study. 1.6 SCHEMATIC ACTION PLAN FOR PROJECT
PREPARATIONFrom 24 may onwards the job was to study the INCOTERMS
From 1 June onwards the job was to study contracts From 8 june
onwards the job was to study UCPDC norms and Export Import
documentation From 17 June onwards the job was to study the RBI
regulation, central excise duties etc. As far as report is
concerned following plan was followed Consultation of published
literature on the subject 18-6-12
Tabulation and Data analysis 25-6-12
Report writing 10-7-12
2. WORLD STEEL SCENARIOThe 2009 global downturn and the
subsequent recovery have brought to light the increasing importance
of China and India to the world steel industry. In 2010, recovery
in steel demand was far from consistent across the globe and
steelmakers had to work hard to manage their working capital as a
result of fluctuating demand. However, while most of the global
steel industry continued to feel pressure from the recessionary
trends of 2009, steel demand and associated production in the BRICK
(Brazil, Russia, India, China and Korea) regions continued to be a
key driver in growth. Brazil and South Korea recovered strongly
from the economic crisis and are expected to register higher steel
production in the medium term.However, the real shining lights on
the horizon as far as growth in crude steel production, and the
next frontier of growth, can be seen in both China and India. Both
countries domestic steel demand not only survived the economic
slowdown, but they also grew at a significant rate. As a
consequence, China has become the virtual engine of the global
steel industry, accounting for 45% of production in 2010, but India
too has shown it is rapidly becoming an important part of the
international steel market place. Indeed, it was recently confirmed
as the fifth largest steel producer in the world, and there are
strong predictions it will become the second largest steel producer
globally in coming years.In 2012, global steelmakers are hoping for
a more stable rate of recovery in demand. This will be dependent on
whether there is an increase in consumer spending and business
investment, to compensate for the potential lessening of government
fiscal stimuli. Due to the sovereign debt crisis of many developed
countries, there has been a marked shift from stimuli to austerity.
In addition, the massive rise in oil prices inspired by political
turmoil in the Middle East, coupled with the recent catastrophic
events in Japan, increases the risks of a slowdown in growth during
2011. Global trade is estimated to grow by 5.7% in2011, which is a
significant softening from 2010 when global restocking fuelled an
11.5 % increase. The future of both the developed and the
developing world will be governed by different sets of factors. The
emerging markets of China and India will continue to witness strong
growth in their steel industries due to robust demand for
construction and civil engineering, automotive and mechanical
engineering .The growth of developed market show ever will be more
dependent on supply-side response, innovative product offerings and
substitutions. The key driving factor for the profitability of all
steel players will ultimately depend on more tightly managed
operating expenses and capital expenditure.Global Economy projected
to grow by 4.4 percent in 2011 after clocking 5.0 percent in 2010.
Subdued steel demand in EU, Japan and USA. Restriction on real
estate and restructuring of small scale polluting steel units
accompanied by infrastructure build up of backward areas inside the
coastal belt in China maintain a moderate growth in demand in
China. Rising trend in Finished Steel prices particularly in flat
prices following rise in Coal and Iron Ore prices more backed up by
cost of raw materials rather than by effective demand.Steel
industry will witness big changes such as less imports, higher
domestic production and greater investment in raw material. In
2011, it is expected that imports would consist mainly of raw
material and nearly zero semis and finished construction steel.
Construction steel is a big sector that gathers many top domestic
steel businesses. Demand forecasts of construction steel, steel
pipe and galvanized products are optimistic. However, development
of pipe and galvanized sections will meet difficulty because of
constrained supply of raw material. 2.1 World crude steel output
increases by 6.8% in 2011 World crude steel production reached
1,527 megatonnes (Mt) for the year of 2011. This is an increase of
6.8% compared to 2010 and is a record for global crude steel
production. All the major steel-producing countries apart from
Japan and Spain showed growth in 2011. Growth was particularly
robust in Turkey, South Korea and Italy.Figure 1: Annual crude
steel production (Mt)
Annual production for Asia was 988.2 Mt of crude steel in 2011,
an increase of 7.9% compared to 2010. The regions share of world
steel production increased slightly from 64.0% in 2010 to 64.7% in
2011. Chinas crude steel production in 2011 reached 695.5 Mt, an
increase of 8.9% on 2010. Chinas share of world crude steel
production increased from 44.7% in 2010 to 45.5% in 2011. Japan
produced 107.6 Mt in 2011, a -1.8% decrease from 2010. In 2011,
South Koreas crude steel production was 68.5 Mt, a 16.2% increase
compared to 2010.The EU recorded an increase of 2.8% compared to
2010, producing 177.4 Mt of crude steel in 2011. Spain produced
15.6 Mt of crude steel in 2011, a -4.6% decrease on 2010 while
Italy produced 28.7 Mt in 2011, an 11.3% increase over 2010.In
2011, crude steel production in North America was 118.9 Mt, an
increase of 6.8% on 2010. The US produced 86.2 Mt of crude steel,
7.1% higher than 2010.The CIS showed an increase of 4.0% in 2011,
producing 112.6 Mt of crude steel. Russia produced 68.7 Mt of crude
steel, a 2.7% increase on 2010 and Ukraine recorded an increase of
5.7% with a year-end figure of 35.3 Mt. Annual crude steel
production for South America was 48.4 Mt in 2011, an increase of
10.2% on 2010. Brazil produced 35.2 Mt in 2011, 6.8% higher than
2010.Figure 2: Crude steel production annual growth trend (%)
Figure 3: Share of world crude steel production 2011, 2010
2.2 World Steel Demand Assessment (In 2011)2.2.1. Demand by
RegionRegionSteel Demand, mt
EU (27)153
Other Europe33
CIS54
NAFTA121
Central & South America46
Middle East & Africa71
Asia & Oceania895
World1373
Figures above are finished steel product demand estimates for
2011 in millions of metric tonnes. 2.2.2. Demand by Product
ShapeSteel shapeSteel Demand, mt
Flat products640
Long products615
Tube products118
World1373
Figure are indicative finished steel consumption estimates for
2011. Tube data includes welded and seamless tube. For chart, see
below. Source: MCI assessments.
Demand estimates by shape indicate estimated world steel
consumption analysed by flat products [including plate, hot rolled
coil and sheet, cold rolled and coated sheet], long products
[including rail, heavy sections, bar and wire rod] and tube [welded
pipe and seamless tube]. Figures are estimates supplied by Metals
Consulting International for year 2011.2.2.3. Demand by Consuming
End-Use Industry
World steel demand by end-use market
Demand estimates by sector are indicative of global 2011
finished steel demand. Transport includes light passenger vehicles
and trucks. Oil and gas sector estimate includes steel for large
diameter pipe. Steel fabrication includes furniture and components.
'Other' includes packaging, wire, wire rope. Figures are MCI
estimates for year 2011 world steel consumption.2.2.4. Demand by
QualitySteel qualitySteel Demand, mt
Carbon steel1303
Engineering steel41
Stainless steel28
Tool steel~1
World1373
Figures are MCI estimates of finished steel consumption by grade
for 2011. Engineering steels are often also referred to as SBQ
steels (special bar quality steel); these are steels that typically
move or rotate whilst in use. 2.2.5. Demand
ForecastYear200920102011201220132014
World steel demand, mt114013011373142214861538
Figures to 2013 are consistent with World Steel Association
[worldsteel] assessments of April 2012. 2014 figure is MCI
estimate. All figures are millions of metric tonnes of finished
steel. 2.3 World Steel in Figures 2012 The World Steel Association
has published the 2012 edition of World Steel in Figures.Table 1:
Major steel-producing countries20112010
1.China683.9 MtChina637.4 Mt
2.Japan107.6 MtJapan109.6 Mt
3.United States86.4 MtUnited States80.5 Mt
4.India71.3 MtIndia68.3 Mt
5.Russia68.9 MtRussia66.9 Mt
Table 2: Top steel-producing companies2011
1.ArcelorMittal97.2 Mt6Nippon Steel33.4 Mt
2.Hebei Group44.4 Mt7Shagang Group31.9 Mt
3.Baosteel Group43.3 Mt8Shougang Group30.0 Mt
4.POSCO39.1 Mt9JFE29.9 Mt
5.Wuhan Group37.7 Mt10Ansteel Group29.8 Mt
Table 3: Countries with the highest apparent steel use per
capita2011
1.South Korea1,156.6 kg6Austria473.1 kg
2.Taiwan, China784.4 kg7China459.8 kg
3.Czech Republic595.7 kg8Italy459.5 kg
4.Japan506.7 kg9Sweden424.5 kg
5.Germany479.6 kg10Belgium-Luxembourg422.5 kg
Major exporter and importer of steel in 2011 2.4 Analysis and
forecastThe global steel output is expected to hit 1625 mn tons in
2012 , which is up by 5.4% compared to 2011, according to MEPS,
leading supplier of steel market information. It predicts that the
BRIC countries, together with Turkey and USA, will account for 85 %
of the growth in steel. It is believed that market sentiments are
picking up in India and raw materials are becoming easier to source
which will push up the annual steel production this year.
Asian steel making industry will expand over 60 mn tonnes this
year to reach 1064 mn tonnes, in which China will hold a
significant position. Chinese steel output is forecasted to grow by
7.9% year on year.
MEPS predicts that Turkish steel production will be at an
all-time high figure this year. However, the rate of growth will be
slower than last year due to a moderation in domestic consumption
and lower exports.
North American raw steel production in 2012 is expected to rise
by 4.7 percent to a figure in excess of 124 million tonnes, while
South American steel manufacturing is likely to surpass the 50 mn
tonne mark in 2012.
It is believed that steelmakers in Africa should be able to
recover approximately half the lost tonnage from last year in
2012.
In the Middle East, the steel output figure will be the
fourteenth consecutive rise in production, which will hit 25 mn
tonnes
3. INDIAN STEEL INDUSTRY SCENARIOIndian steel industry plays a
significant role in the countrys economic growth. The major
contribution directs the attention that steel is having a
stronghold in the traditional sectors, such as infrastructure &
constructions, automobile, transportation, industrial applications
etc. Moreover, steel variant stainless steel is finding innovative
applications due to its corrosion resistive property. India has
emerged as the fourth largest steel producing nation in the world,
as per the recent figures release by World Steel Association in
April 2011. In 2010, India was the 5th largest producer, after
China, Japan, USA and Russia had recorded a growth of 11.3% in
steel production as compared to 2009. Overall domestic crude steel
production grew at a compounded annual growth rate of 8.4% during
2005-06 to 2009-10. The Indian steel industry accounted for around
5% of the worlds total productionTotal crude steel production in
India for 2010-11 was around 69 million tonnes and its expected
that the crude steel production in capacity in the country will
increase to nearly 110 million tonne by 2012-13. Further, if the
proposed expansion plans are implemented as per schedule, India may
become the second largest crude steel producer in the world by
2015-16.
The demand for steel in the country is currently growing at the
rate of over 8% and it is expected that the demand would grow over
by 10% in the next five years. However, the steel intensity in the
country remains well below the world levels. Our per capita
consumption of steel is around 110 pounds as compared to 330 Pounds
for the global average. This indicates that there is a lot of
potential for increasing the steel consumption in India.
POSITION OF INDIA IN WORLD STEEL PRODUCTION IN
2010-11YEAR20102011
RANKCOUNTRYPRODUCTION*COUNTRYPRODUCTION*
1 China627.7China695.5
2Japan109.6Japan107.5
3U.S.A.80.6U.S.A.86.2
4Russia67India72.2
5India66.8Russia68.7
6South Korea58.5South Korea68.5
7Germany43.8Germany44.3
8Ukraine33.6Ukraine35.3
9Brazil32.8Brazil35.2
10Turkey29Turkey34.1
Note * production in million tonnesANALYSIS The India has
occupied 4th position in the world steel production in year 2011
from 5th in 2010. It is believed that the it will occupy the second
position in world steel production very soon. In 2011 India has not
only increased the production but also defeated Russia though
Russia too has increased its production. The increased production
of steel is mainly compounded by the increased capacity of plants
derived by the technological upgradations and higher labour
productivity 3.1 PRODUCTION OF CARBON STEEL The growth was driven
by capacity expansion from 47.99 million tonnes per annum (MTPA) in
2004-05 to 72.2 MTPA in 2011-12. The crude steel production grew at
CAFR of 8.4% during the past five years that is 2005-2010, in
further year growth is expected to grow at the rate of 10%. The
total production of finished carbon steel in country has been
2010-11 as compared to 42.64 million tonnes in 2005-06. Indias
steel production trends
The high share of the secondary sector in finished steel
production is largely due to substantial supplies of semis, the
basic feed material from the main producer for conversion to needed
shape by rolling
3.2 PRODUCTION, CONSUMPTION AND GROWTH OF STEEL INDUSTRY IN
INDIAThe rapid pace of growth of the industry and the observed
market trends called for certain guidelines and framework. Thus was
born the concept of National steel policywith the aim to provide
the roadmap of growth and development for the Indian steel
industry. India is one of the few countries where the steel
industry is poised for rapid growth. Indias share in world
production of crude steel increased from 1.5% in 1981 to around
3.5% in 2004, presently our share in world steel market is 4.7%.
While plant closure and privatisation are rare in India, the
private sector is considered to be engine of growth in steel
industry and technological changes and modernisation are taking
place in both the public and private sector integrated steel plants
in India.
3.3 TRENDS IN PRODUCTION OF CRUDE STEEL IN PRIVATE AND PUBLIC
SECTORTraditionally, Indian steel industry has been classified into
main producers (SAIL plants, Tata steel and Vizag steel/RINL),
major producers (plants with crude steel making capacity above 0.5
million tonnes-Essar steel, JSW steel, Jindal steel and power and
Ispat industries) and other producers. The latter comprises of
numerous steel making plants producing crude steel/finished steel
(long products/flat products), pig iron, sponge iron are spread
across the different states of the country. The following table
highlights the total as also the contribution of private and public
sector in crude steel production in the country. 3.4 PROCESS WISE
PRODUCTION The process route-wise production of crude steel in the
country during 2005-06, 2009-10 and April-December 2010-11 are
shown in the table below and indicate the emergence of the electric
route of production compared to the oxygen route:Crude steel
production by Process Route Percentage share (%)
2005-06 2009-10 2010-11
Basic Oxygen Furnace (BOF) 52 45 47
Electric Arc Furnace (EAF) 18 24 26
Induction Furnace (IF) 30 31 27
Total 100 100 100
Indias current steel production capacity is 72.2 million tonnes
per year including both public and private producers. According to
the ministry of steel by 2011-12,the capacity is expected to
increased to 124 million tonnes per annum on the back of major
expansion plans announced by steel producer. According to the steel
ministry, around 222 MoUs have been signed with various states for
planned capacity of around 276 million tonnes. Majorly investment
plans are in states of Orissa, Jharkhand, Chhattisgarh, West
Bengal, Karnataka, Gujarat and Maharashtra 3.5 CAPACITY EXPANSION
PLANS ANNOUNCED BY STATES 3.6 IMMENSE GROWTH POTENTIAL IN INDIAN
STEEL SECTOR Domestic crude steel production grew at a compounded
annual growth rate of 8.4% in the last few years. Crude steel
production capacity of the country is projected to be around 110
million tonne by 2012-13. 222 Memorandum of Understandings (MOU)
have been signed with various states for planned capacity of around
276 million tonnes by 2019-20. Investments at stake are to the tune
of $187 billion in the Steel sector. Increase in the demand of
steel in India is expected to be 14% against the global average of
5-6% due to its strong domestic economy, massive infrastructure
needs and expansion of industrial production. Demand of steel in
the major industries like infrastructure, construction, housing,
automotive, steel tubes and pipes, consumer durables, packaging and
ground transportation. Target for $ 1 trillion of investments in
infrastructure during the 12th Five Year Plan. Infrastructure
projects (like Golden Quadrilateral and Dedicated Freight Corridor)
will give boost to the demand in the steel sector in near future.
Projected New Greenfield & up-gradation of existing Airport
shall keep the momentum up. Increased demand of specialized steel
in hi-tech engineering industries such as power generation,
automotive petrochemicals, fertilizers etc. 4. Steel Authority of
India Limited- A MAHARATNASteel Authority of India Limited (SAIL)
is the leading steel-making company in India. It is a fully
integrated iron and steel maker, producing both basic and special
steels for domestic construction, engineering, power, railway,
automotive and defence industries and for sale in export markets.
SAIL is also among the five Maharatnas of the country's Central
Public Sector Enterprises.SAIL manufactures and sells a broad range
of steel products, including hot and cold rolled sheets and coils,
galvanised sheets, electrical sheets, structurals, railway
products, plates, bars and rods, stainless steel and other alloy
steels. SAIL produces iron and steel at five integrated plants and
three special steel plants, located principally in the eastern and
central regions of India and situated close to domestic sources of
raw materials, including the Company's iron ore, limestone and
dolomite mines. The company has the distinction of being Indias
second largest producer of iron ore and of having the countrys
second largest mines network. This gives SAIL a competitive edge in
terms of captive availability of iron ore, limestone, and dolomite
which are inputs for steel making.SAIL's wide range of long and
flat steel products is much in demand in the domestic as well as
the international market. This vital responsibility is carried out
by SAIL's own Central Marketing Organisation (CMO) that transacts
business through its network of 37 Branch Sales Offices spread
across the four regions,25 DepartmentalWarehouses, 42 Consignment
Agentsand 27 Customer Contact Offices. CMOs domestic marketing
effort is supplemented by its ever widening network of rural
dealers who meet the demands of the smallest customers in the
remotest corners of the country. With the total number of
dealersover 2000, SAIL's wide marketing spread ensures availability
of quality steel in virtually all the districts of the country.With
technical and managerial expertise and know-how in steel making
gained over four decades, SAIL's Consultancy Division (SAILCON) at
New Delhi offers services and consultancy to clients
world-wide.SAIL has a well-equipped Research and Development Centre
for Iron and Steel (RDCIS) at Ranchi which helps to produce quality
steel and develop new technologies for the steel industry. Besides,
SAIL has its own in-house Centre for Engineering and Technology
(CET), Management Training Institute (MTI) and Safety Organisation
at Ranchi. Our captive mines are under the control of the Raw
Materials Division in Kolkata. The Environment Management Division
and Growth Division of SAIL operate from their headquarters in
Kolkata. Almost all our plants and major units are ISO Certified.
SAIL traces its origin to the formative years of an emerging nation
- India. After independence the builders of modern India worked
with a vision - to lay the infrastructure for rapid
industrialisation of the country. The steel sector was to propel
the economic growth. Hindustan Steel Private Limited was set up on
January 19, 1954.VISIONTo be a respected world Class Corporation
and the leader in Indian steel business in quality, productivity,
profitability and customer satisfaction.CREDO We build lasting
relationships with customers based on trust and mutual benefit. We
uphold highest ethical standards in conduct of our business. We
create and nurture a culture that supports flexibility, learning
and is proactive to change. We chart a challenging career for
employees with opportunities for advancement and rewards. We value
the opportunity and responsibility to make a meaningful difference
in people's lives.4.2 PRODUCTS OF SAILLONG PRODUCTS FLAT
PRODUCTS
RAILWAY PRODUCTS
SEMIS
OTHER PRODUCTS
1.Structurals 2.Crane Rails 3. Z-Section Centre Sill 4. Z-Type
Sheet-piling Section 5. M S Arch 6. Bars, Rods HYPERLINK
"http://www.sail.co.in/sail%20product/Bars.html"&HYPERLINK
"http://www.sail.co.in/sail%20product/Bars.html" HYPERLINK
"http://www.sail.co.in/sail%20product/Bars.html"RebarsHYPERLINK
"http://www.sail.co.in/sail%20product/Bars.html": SAIL TMT 7. Wire
Rods
1. HR Coils, Sheets HYPERLINK
"http://www.sail.co.in/sail%20product/Hotrolled.html"&HYPERLINK
"http://www.sail.co.in/sail%20product/Hotrolled.html" HYPERLINK
"http://www.sail.co.in/sail%20product/Hotrolled.html"Skelp 2.
Plates 3. CR Coils HYPERLINK
"http://www.sail.co.in/sail%20product/ColdRolled.html"&HYPERLINK
"http://www.sail.co.in/sail%20product/ColdRolled.html" Sheets 4. GP
Sheets HYPERLINK
"http://www.sail.co.in/sail%20product/Galvanisedplainsheets.html"&HYPERLINK
"http://www.sail.co.in/sail%20product/Galvanisedplainsheets.html"
Coils, GC Sheets:SAIL JYOTI Tin Plates Electrical Steel 5.
PIPES
1. Rails 2. Wheels, Axles HYPERLINK
"http://www.sail.co.in/sail%20product/Wheels.html"&HYPERLINK
"http://www.sail.co.in/sail%20product/Wheels.html" Wheel Sets
1.Blooms 2.Billets 3.Slabs
Pig Iron
4.3 PLANTS OF SAIL SAIL Integrated Steel Plants Rourkela Steel
Plant(RSP) inOrissaset up with German collaboration (The first
integrated steel plant in the Public Sector in India, 1959)
BhilaiHYPERLINK "http://en.wikipedia.org/wiki/Bhilai_Steel_Plant"
Steel Plant(BSP) inChhattisgarhset up with Soviet collaboration
(1959) Durgapur Steel Plant(DSP) atDurgapur, West Bengalset up with
British collaboration (1965) BokaroHYPERLINK
"http://en.wikipedia.org/wiki/Bokaro_Steel_Plant" Steel Plant(BSL)
inJharkhand(1965) set up with Soviet collaboration (The Plant is
hailed as the countrys first Swadeshi steel plant, built with
maximum indigenous content in terms of equipment, material and
know-how) IISCOSteel Plant (ISP) atBurnpur,West Bengal
Special Steel Plants Steel Authority of India Limited
(SAIL),Kanpur, Uttar Pradesh Alloy Steels Plants (ASP),Durgapur,
West Bengal Salem Steel Plant (SSP),Tamil Nadu
VisvesvarayaHYPERLINK
"http://en.wikipedia.org/wiki/Visvesvaraya_Iron_and_Steel_Limited"
Iron and Steel Limited(VISL), atBhadravathi,Karnataka
Subsidiaries Maharashtra Elektro-smelt Limited (MEL)
inMaharashtra
4.4 MAIN ACTIVITIESA. It produces both basic and special steels
for domestic construction, engineering, power, railway, automotive
and defence industries and for sale in export markets.B. SAIL
manufactures and sells a broad range of steel products, including
hot and cold rolled sheets and coils, galvanized sheets, electrical
sheets, structurals, railway products, plates, bars and rods,
stainless steel and other alloy steelsC. SAIL produces iron and
steel at five integrated plants and three special steel plants,
located principally in the eastern and central regions of India and
situated close to domestic sources of raw materials, including the
Company's iron ore, limestone and dolomite mines.D. SAIL's wide
range of long and flat steel products is much in demand in the
domestic as well as the international market. This vital
responsibility is carried out by SAIL's own Central Marketing
Organisation (CMO) that transacts business thorough International
trade Division.E. SAIL's International Trade Division ( ITD), in
New Delhi- an ISO 9001:2000 accredited unit of CMO, undertakes
exports of Mild Steel products and Pig Iron from SAILs five
integrated steel plants.F. With technical and managerial expertise
and know-how in steel making gained over four decades, SAIL's
Consultancy Division (SAILCON) at New Delhi offers services and
consultancy to clients world-wide.G. SAIL has a well-equipped
Research and Development Centre for Iron and Steel (RDCIS) at
Ranchi which helps to produce quality steel and develop new
technologies for the steel industry. 4.5 OWNERSHIP AND MANAGEMENT
Steel Authority of India Limited is a public sector Undertaking.
The Government of India owns about 86% of SAIL's equity and retains
voting control of the Company. However, SAIL, by virtue of its
Maharatna status, enjoys significant operational and financial
autonomy.
4.6 INTERNATIONAL TRADE DIVISIONInternational Trade Division
(ITD) of SAIL at New Delhi an ISO 9001:2000 accredited unit of CMO,
undertakes exports of Mild Steel products and Pig Iron from SAILs
five integrated steel plants. Ever ready to meet the exacting
demands of its global customers, ITD maintains a close liaison with
customers and the production units to cater to the customized
requirements of its customers both in terms of quality and sizes.
Its major products are also covered by stringent certifications
such as CE marking, TUV and U mark required by sophisticated end
uses in European markets.ITD has. The critical function of ensuring
efficient shipment of export materials is performed by Transport
& Shipping Division (T&S) Headquartered at Kolkata. T&S
has branch offices at Haldia, Paradip and Vizag ports.ITD exports
steel products mentioned below via its joint venture service centre
Rails, Structurals, Merchant Products, Wire Rods, Re-bars, Plate
Mill Plates, Hot Rolled Coils, Hot Rolled Plates / Sheets, Cold
Rolled steels, Cold Rolled Non Oriented (CRNO) coils, Chequered
Plates, Slabs, Billets and Pig Iron. Steel Authority of India
Limited has successfully implemented its Export potential in the
following markets: Japan, P.R. of China, Korea, Taiwan, Vietnam,
Philippines, Singapore, Malaysia, Nepal, Bangladesh Thailand, Sri
Lanka Indonesia, Australia, Europe
4.7 SAIL CORPORATE PLAN 2012SAILs newly announced Corporate Plan
2012 sets out the blueprint for this growth plan. According to an
official of the company, a major factor that prompted formulation
of Corporate Plan 2012 was the continual improvement in operating
efficiency achieved by the company. As pointed out by the Chairman
in many forums, exceeding rated shop capacity has become more of a
norm rather than exception in the SAIL plants, he says. Also, the
culture of cost reduction and improvement in business processes has
helped the company build up its internal resources which will
contribute to achievement of the growth plan. For realistic
accomplishment of targets set, the plan has been split into two
stages Stage 1 pertaining to the period up to 2006-07 and Stage 2
up to 2011-12.The plan defines the following key strategic goals
for SAIL: To continue in the business of steel and steel-related
activities To enhance market share in growth segments To improve
profits by cost reduction and high value added products To achieve
excellence in quality across the value chain To secure availability
of key raw materials, and alleviate infrastructure bottlenecks
which may constrain long-term growth To build customer-centric
processes, systems, structure and procedures A significant feature
of the plan is that it covers the 11th Five-year Plan period.4.7.1
PRODUCTIONCorporate Plan 2012 envisages production of hot metal
from the integrated steel plants of SAIL reaching an aggregate
level of about 20 MT per annum by 2011-12 against the current level
of 13 MT. This would be achieved through optimal utilization of
assets coupled with marginal capacity expansion. Plant-wise
break-up of hot metal production would be as follows: The envisaged
growth in volumes is to be achieved by: Realisation of full
potential of existing assets Do-bottlenecking Linked facilities for
value addition Capacity enhancement in growth segmentsBased on the
above, crude steel production by SAIL is planned to reach a level
of 18.7 million tonnes per annum (MTPA) by 2012 from the current
level of 11.83 MT, leading to saleable steel production of 17.38
MTPA against the level of 10.73 MT achieved in 2003-04. In view of
emerging market requirements, SAIL has also planned to raise its
output of finished steel to 16.6 MTPA by 2011-12 from the current
level of 8.6 MT, and reduce generation of semi-finished steel from
20% of saleable steel to 5%. This will enable inclusion of more
value-added products in the companys product basket. Broadly, this
would enable SAIL to achieve 30% market share in flat products and
23% in longs by 2011-12. 4.7.2 INVESTMENTSAIL has estimated that
the measures to be taken to achieve the targeted levels of growth
and sustain higher levels of cost and quality competitiveness will
require investment in the region of Rs.25, 000 crore by 2011-12.
The immediate priority schemes, to be taken/completed by 2006-07,
have been estimated to be around Rs.4, 300 crore. The capital
expenditure envisaged will be financed mainly through internal
accruals, and will be supplemented by market borrowing if the need
arises. Care will be taken to ensure that the companys debt-equity
ratio attains, and is maintained at, a level of 1:1. The plan for
capital expenditure covers up gradation/modernization of some
existing assets as well as installation of some new facilities. The
areas broadly identified for investment pertain to: Development of
iron ore mines Rebuilding Coke Oven Batteries as BSP, DSP and RSP
Revamping of iron & steel making facilities at BSP, DSP and BSL
Installation of one blast furnace at RSP Installation of auxiliary
fuel injection systems in all blast furnaces in a phased manner
Installation of new finished mills Among new finished mills planned
to be set up are: BSP: Thin slab casting/inline Hot Strip Mill (1.1
MT), Bar & Rod Mill (1MT), Pipe Plant (0.2 MT) DSP: Bar &
Rod Mill (1.4 MT), Structural Mill (0.4 MT) RSP: Plate Mill (0.7
MT), CRNO Mill (0.075 MT) BSL: Hot Strip Mill (2.5 MT), CRM Line
(0.6 MT) 4.7.3 RAW MATERIALSThe growth plan and achievement of
quality/cost competitiveness of SAIL to a significant extent will
hinge on the availability, quality and cost of key inputs like coal
and iron ore.SAIL has the largest iron ore mining operations in
India. To enable production of around 20 MT of hot metal by 2012,
substantial development of mines to increase the iron ore
production to a level of around 33 MT, including 6-7 MT of lump
ore, will have to be taken up, sources said. To meet the
requirement, SAIL has planned to adopt following strategies:
Development new blocks/mines Increased production from existing
mines to their potential Improving the quality of iron ore by
suitable beneficiation Achieving operating efficiencies by economic
scale of operations 4.7.4 IMPLEMENTATIONCorporate Plan 2012 has
considered the following major risk factors in achievement of the
targeted growth have been identified as Declining global steel
demand and prices Constraints in availability, and cost of critical
raw material like coking coal, iron ore, etc. Infrastructure
constraints, viz. ports, railways, etc.These factors will be
reviewed proactively and timely interventions will be ensured.
Steel being a universal intermediary, its demand is driven by
economic growth and the expansion trajectory of the industrial
sector. The growth trajectory (reflected in terms of percentage of
GDP growth) is essentially a range based on macro-economic
parameters, government policies and global economic trends. While
drawing up Corporate Plan 2012, conservative market growth
projections have been considered. However, while the growth trends
and macro indicator present opportunities for the companys higher
growth potential; major risk factors have also been taken into
consideration like decline in global steel demand and prices,
non-availability/cost of major input materials like coal, etc.
Therefore, in any case, SAILs plans may have to be revised from
time to time, depending on the market growth, competition,
international situation, change in countrys policies, resources
availability, etc.
4.8 JOINT VENTURES AND MOUSAIL has promoted joint ventures in
different areas ranging from power plants to e-commerce:A. NTPC
SAIL Power Company Pvt. Ltd (NSPCL)A 50:50 joint venture between
Steel Authority of India Ltd. (SAIL) and National Thermal Power
Corporation Ltd. (NTPC Ltd.); manages the captive power plants at
Rourkela, Durgapur and Bhilai with a combined capacity of 314
megawatts (MW). It has installed additional capacity by
implementation of 500 MW (2 x 250 MW Units) power plant at Bhilai.
The commercial generation of 1st Unit has commenced in April2009
and the 2nd Unit in October 2009 B. Bokaro Power Supply Company
Pvt. Limited (BPSCL)This 50:50 joint venture between SAIL and the
Damodar Valley Corporation formed in January 2002 is managing the
302-MW power generating station and 660 tonnes per hour steam
generation facilities at Bokaro Steel Plant. BPSCL has proposed to
expand its capacity by installing 2x250 MW coal based thermal unit
at Bokaro. In addition, construction activities are underway for
installation of 9th Boiler (300T/Hr) & 36 MW Back Pressure
Turbo Generator (BPTG) project at Bokaro. C. Mjunction Services
LimitedA 50:50 joint venture between SAIL and Tata Steel formed in
2001. This company promotes e-commerce activities in steel and
related areas. Newly added services include e-Assets sales, Events
& Conferences, Coal Sales & Logistics, Publications etc...
D. SAIL-Bansal Service Centre Ltd.SAIL has formed a joint venture
with BMW industries Ltd. on 40:60 basis to promote a service centre
at Bokaro with the objective of adding value to steel. E.
SAIL&MOIL Ferro Alloys (Pvt.) LimitedSAIL has incorporated a
joint venture company with M/s Manganese Ore (India) Ltd on 50:50
basis to produce Ferro-manganese and silico-manganese required for
production of steel: MOU POSCO to establish strategic alliance for
cooperation in a wide range of business & commercial interest
areas. Pursuant to this, another MoU has been signed for joint
venture initiative in the area of (a) manufacture &
commercialization of CRNO; & (b) Exploration of upstream &
downstream opportunities in utilizing FINEX technology by both the
companies. Rashtriya Ispat Nigam Ltd. (RINL) - To jointly explore
and develop low silica Limestone mines in the Sultanate of Oman. .
Shipping Corporation of India Ltd (SCI) To set up a joint venture
which will provide shipping-related services to SAIL for imported
coking coal and also participate in worldwide dry bulk shipping
trade. Government of Kerala (GOK) To revive the existing facilities
at Steel Complex Ltd in Calicut owned by the state government, and
also set up, develop and manage a TMT rolling mill of 65000 MT
capacity along with balancing facilities and auxiliaries. Larsen
& Toubro Ltd (L&T) To jointly set up, develop, manage and
own captive/independent power plant(s) at suitable location/s to
meet future power requirements of SAIL including opportunities to
own captive thermal coal blocks to cater to the power plants
requirements.. 4.9 SAILs FINANCIAL PERFORMANCE FY 2010-11
4.9.1. NET SALES (Rs. Crore) The net sales have been fell down
in year 09-10 after a fair growth in year 08-09, but as per the
recent scenario is concerned, the net sales 4.9.2 EARNING BEFORE
INTEREST, DEPRECIATION AND TAX (in Rs. Crore) The earnings before
interest, tax and depreciation is showing the declining trends in
the recent years, after a good uprising in year 08-09 4.9.3 EARNING
AFTER TAX
Earnings after tax is declining is well like earnings before
tax, after an uprising in the year 09-104.9.4 EARNING PER SHARE The
earnings per share is declining as far as recent financial years
are concerned, FY 04-05 showing the best growth rate whereas FY 08
showing moderate growth rate. 4.10 PLANT AND PRODUCTION WISE
PRODUCT MIX The following figure is showing the plant and
production wise product mix, showing the capacity of each plant to
produce each product
IISCO is having the largest capacity to produce the long
products, followed by Bhillai steel plant Rourkela steel plants and
Bokaro steel plant are the largest producer flat products followed
by Bhillai steel plant Durgapur steel plant have the largest
capacity to produce semis followed by IISCO steel plant. 4.11.
CATEGORY WISE SALE VOLUME (%) ANALYSIS The largest share of sale
volumes is taken by the HR coil, HR plates/sheets, Skelps which has
been increased in year 2011 to 37% from 34% in 2010, Followed by PM
plate whose share is remained same that is 14% for both the year
2010 and 2011. The share of semis has been fallen down from 11% in
2010 to 9% in 2011, whereas share of Round and TMT as well as
railways products is static at 11% and 8% respectively in both the
years. 4.12 SAIL EXPANSION PLAN 4.13 SAIL CORPORATE SOCIAL
RESPONSIBILITY Health care Education 5. EXPORT POTENTIAL OF BILLETS
AND HOT ROLLED COILS WITH FOCUS ON MENA AND SOUTH EAST ASIA MENA
(MIDDLE EAST AND NORTH AFRICA)The termMENA, for "Middle
EastandNorth Africa", is anacronym often used inacademicand
business writing. The term generally covers an extensive region,
extending fromMoroccoin northwest AfricatoIranin southwestAsia. It
generally includes all theArab Middle EastandNorth
Africacountries.Gulf Cooperation Council(GCC), officially
Cooperation Council for the Arab States of the Gulf, organization
(est. 1981) promoting stability and economic cooperation among
Persian Gulf nations. Its members are Bahrain, Kuwait, Oman, Qatar,
Saudi Arabia, and the United Arab Emirates. In 1991 the GCC
countries joined with Egypt and Syria to create a regional
peacekeeping force. An aid fund was also established to promote
development in Arab states; it was used to help liberate Kuwait in
1991. In 2003 GCC members eliminated tariffs on trade between
member nations and established common external tariffs. They have
agreed to establish a broader economic union (including a single
market and currency; Oman and United Arab Emirates have opted out);
a common market was established in 2008. Middle East & North
Africa Steel Market at a glanceThe Middle East and North Africa
(MENA) region is considered currently a key growth markets for the
steel industry at the consumption and production alike due to the
fast-expanding construction & fabrication sector. It has
witnessed major transformations over the past years, as Arabian
countries try to emerge from the shadows of the developed world and
become more industry oriented.Over the past couple of years, the
steel industry worldwide has been experiencing stunning growth and
the Middle East has flourished to become major players in the steel
market. The real estate sector has been at the heart of the demand,
as this sector witnessed tremendous activity. Consequently, steel
companies in the MENA region entered 2008 strongly, pushed by their
momentum and massive profits achieved in the previous year. In
2007, Egypt and Saudi Arabia ranked 27th and 35th, respectively,
among the worlds steel producing countries. These positions reflect
the substantial improvements that both countries underwent over the
years to enhance their steel making capabilities. Steel production
in the MENA region has been steadily increasing over the past two
decades to meet the Arab countries ever growing demand for steel.
In 1990, total steel production in the Arab countries amounted to
approximately 4mn tons. In 2008, steel produced by Arab countries
in the Middle East and North Africa amounted to 15.5mn tons.Steel
manufacturers in Arab countries are exerting efforts to integrate
and consolidate their position in the face of a growing worldwide
industry trend of mergers and acquisitions. There are 67 steel
plants in the Arab region. The demand for steel is rising at five
to six per cent every year. It is predicted that half of the
world's steel production will be done in Arab countries by 2012 and
Arab countries succeed in keep up with worldwide development in the
steel industry.The MENA region is considered to be among the top
five locations in the world to establish a steel factory, due to a
favorable environment and relatively cheap energy prices.5.2 STEEL
SCENARIO IN MENA World Steel Association data shows that Global
Crude Steel Production fell by 7% in 2009, or by 21% with Chinese
growth excluded. Production in the Middle East increased by 6% in
2009, driven by a 9% increase in Iranian output while production in
North Africa fell 12% leading to production across the region as a
whole remaining unchanged. 2010 saw output in the Middle East
increase by 11% while that in North Africa rose by 18% with 2011
seeing Middle Eastern production rise a further 7% with North
African output falling by 15% following extensive unrest.
5.2.1 MENA crude steel production ANALYSIS The annual production
of the crude steel in MENA is rising at the faster rate, showing
the increased demand of the steel 5.2.2 Export of steel to MENA
Combined exports of Steel Mill Products (semis, long & flat
products, tubes) to the MENA region reached a record 48 million
tonnes in 2008. While exports to the countries of the Middle East
fell 22% in 2009 those to North African countries rose by 35%
leading to only a 9% fall in the total shipped to the region as a
whole. 2010 saw exports to the MIddle East rise just 7% on 2009
levels while exports to North Africa fell back 30% meaning that
total exports to the region decreased a further 6%. 2011 saw
exports to the region fall a further 6% to 40 Mt, including those
to North Africa down by 13%.
ANALYSISThe year wise analysis shows that the export of the
steel mills to Middle East has been declined as compared to year
2008Similarly the year wise analysis shows that the export of steel
mills has been declined as compared 2009 in north African
region.The quaterly analysis of the year 2011 shows that the export
of the steel mills products is increasing gradually in both in
middle east and north African region.The growth of the export
potential in middle east is growing at more faster rate than north
africa
5. PRODUCT INFORMATION Before going into the export potential we
should be clear about the product, its manufacturing process, its
types, and its performance in the world steel industry5.1 BILLETS
Raw steel cannot be of use while in its pure form, thus it has to
be cast into shape. The freshly made steel, which is still in the
form of a metal bar or rectangle, is called steel billet. Steel
billets became popular in the early 1800s, just after the British
colonization of the United States ended and American entrepreneurs
began to manufacture brass and bronze billet, which later became
one of the fast-rising industries in the new country. Copper and
iron were almost not to be found in the United States back then, as
the British transported all American copper to Britain for further
molding and processing.Steel billets have distinct characteristics
as compared with already furnished steel bars and products. Billets
have a specific grain structure, which enables the metal to be
processed more intricately. Steel billets are also known for their
malleability and ductility, especially when exposed to varying
temperatures during shaping and molding. Billets or ingots are not
of practical use until they have been formed into more functional
shapes and sizes. While they have already been put in the furnace,
they still require a series of shaping and molding procedures such
as hot and cold working, milling and cutting before they are sold
in hardware stores, or used for different applications. The
unformed billets, however, can be used in striking currency such as
coins and as reserves, similar to gold bars. Steel billets are
considered fresh and raw, and they must undergo a series of
manufacturing processes before they can be used for various
purposes. Billets are made by means of freezing molten liquid, and
are later exposed to extremely low temperatures in order to allow
the metal to take shape and solidify in chemical structure. The
temperature manipulates the metal's physical properties, and tones
its strength and durability. The subsequent processes provide the
metal's curved mold design so that it can fit the allotted space
provided by other machines, which complete the finishing
proceduresSteel billets result from the second stage of the steel
production process. They are hot-rolled or forged from an ingot or
strand cast. Smaller and longer than a bloom, billets are usually a
square cross section less than 36 square inches. They are used for
the manufacture of all 'long' steel products such as bars, rods,
pipes, tubes, wire and wire products. 5.1.1 MANUFACTURING
PROCESS
1. Ladle 2. Stopper 3. Tundish 4. Shroud 5. Mold 6. Roll support
7. Turning zone 8. Shroud 9. Bath level 10. Meniscus 11. Withdrawal
unit 12. Slab
0. Liquid metal 0. Solidified metal0. Slag0. Water-cooled copper
plates0. Refractory material
Molten metal (known ashot metalin industry) is tapped into the
ladle from furnaces. After undergoing any ladle treatments, such as
alloying and degassing, and arriving at the correct temperature,
the ladle is transported to the top of the casting machine.
Usually, the ladle sits in a slot on a rotating turret at the
casting machine; one ladle is 'on cast' (feeding the casting
machine) while the other is made ready, and is switched to the
casting position once the first ladle is empty.From the ladle, the
hot metal is transferred via arefractoryshroud (pipe) to a holding
bath called atundish. The tundish allows a reservoir of metal to
feed the casting machine while ladles are switched, thus acting as
a buffer of hot metal, as well as smoothing out flow, regulating
metal feed to the molds and cleaning the metal.Metal is drained
from the tundish through another shroud into the top of an
open-base coppermold. The depth of the mold can range from 0.5 to 2
metres (20 to 79 in), depending on the casting speed and section
size. The mold is water-cooled to solidify the hot metal directly
in contact with it; this is theprimary coolingprocess. It also
oscillates vertically (or in a near vertical curved path) to
prevent the metal sticking to the mold walls. A lubricant can also
be added to the metal in the mold to prevent sticking, and to trap
any slag particlesincluding oxide particles or scalethat may still
be present in the metal and bring them to the top of the pool to
form a floating layer of slag. Often, the shroud is set so the hot
metal exits it below the surface of the slag layer in the mold and
is thus called a submerged entry nozzle (SEN). In some cases,
shrouds may not be used between tundish and mold; in this case,
interchangeable metering nozzles in the base of the tundish direct
the metal into the moulds. Some continuous casting layouts feed
several molds from the same tundish.In the mold, a thin shell of
metal next to the mold walls solidifies before the middle section,
now called a strand, exits the base of the mold into a
spray-chamber; the bulk of metal within the walls of the strand is
still molten. The strand is immediately supported by closely
spaced, water cooled rollers; these act to support the walls of the
strand against the ferrostatic pressure (comparehydrostatic
pressure) of the still-solidifying liquid within the strand. To
increase the rate of solidification, the strand is also sprayed
with large amounts of water as it passes through the spray-chamber;
this is thesecondary coolingprocess. Final solidification of the
strand may take place after the strand has exited the
spray-chamber.It is here that the design of continuous casting
machines may vary. This describes a 'curved apron' casting machine;
vertical configurations are also used. In a curved apron casting
machine, the strand exits the mold vertically (or on a near
vertical curved path) and as it travels through the spray-chamber,
the rollers gradually curve the strand towards the horizontal. In a
vertical casting machine, the strand stays vertical as it passes
through the spray-chamber. Molds in a curved apron casting machine
can be straight or curved, depending on the basic design of the
machine.In a true "Horizontal Casting Machine", the mold axis is
horizontal and the flow of steel is horizontal from liquid to thin
shell to solid (no bending). In this type of machine, either strand
oscillation or mold oscillation is used to prevent sticking in the
mold.After exiting the spray-chamber, the strand passes through
straightening rolls (if cast on other than a vertical machine) and
withdrawal rolls. There may be ahot rollingstand after withdrawal,
in order to take advantage of the metal's hot condition to
pre-shape the final strand. Finally, the strand is cut into
predetermined lengths by mechanical shears or by travelling
oxyacetylene torches, is marked for identification and either taken
to a stockpile or the next forming process.In many cases the strand
may continue through additional rollers and other mechanisms which
might flatten roll or extrude the metal into its final shape. 5.1.2
WORLD BILLETS SCENARIOThe world steel asscociation have collected
the data for the billets production export and import from all over
the world on the regional basis. The following graphs are revealing
the billet trade trends
A. World production of billets ANALYSIS Asia is holding the
leading position in billet production followed by CIS and Europe
The annual production of billet in CIS has been declined in year
2008-10 followed by slight increase in production in year 2010-11
The world production of billets was showing declining trends since
year 2007-10, but increased fairly in year 2010-11 B. IMPORT OF
BILLETS AND SEMIS ANALYSIS Asia is leading importer of billets
followed by Europe and Middle East. But the annual import of
billets in Asia have been declined in year 2010-11 Though Europe is
the second largest importer of billets after Asia, the annual
import of billets is showing a fair growth, making the region
attractive for the billets export The world imports of billets
though have declined sharply in year 2009-10 but have increased
slightly in year 2010-11. C.EXPORTS OF BILLETS AND SEMIS
ANALYSIS The CIS countries are the leading exporter of the
billets followed by Europe and Asia. The net export of the billets
has been increased in CIS and Europe but declining in Asia in year
2010-11 The world export of the billets has declined in year
2009-10, but has recovered fairly in year 2010-11 5.2 HOT ROLLED
COILHot rolled coils are a kind of FLAT steel product produced by
the hot rolling process. Generally hot rolled flat product are
categorised in three forms Hot rolled sheets Hot rolled plates Hot
rolled coils 5.2.1 MANUFACTURING PROCESS Hot rolling is a
metalworking process that occurs above the recrystallization
temperature of the material. After the grains deform during
processing, they recrystallize, which maintains an equiaxed
microstructure and prevents the metal from work hardening. The
starting material is usually large pieces of metal, like
semi-finished casting products, such as slabs, blooms, and billets.
If these products came from a continuous casting operation the
products are usually fed directly into the rolling mills at the
proper temperature. In smaller operations the material starts at
room temperature and must be heated. This is done in a gas- or
oil-fired soaking pit for larger workpieces and for smaller
workpieces induction heating is used. As the material is worked the
temperature must be monitored to make sure it remains above the
recrystallization temperature. To maintain a safety factor a
finishing temperature is defined above the recrystallization
temperature; this is usually 50 to 100 C (90 to 180 F) above the
recrystallization temperature. If the temperature does drop below
this temperature the material must be re-heated before more hot
rolling. Hot rolled metals generally have little directionality in
their mechanical properties and deformation induced residual
stresses. However, in certain instances non-metallic inclusions
will impart some directionality and workpieces less than 20 mm
(0.79 in) thick often have some directional properties. Also,
non-uniformed cooling will induce a lot of residual stresses, which
usually occurs in shapes that have a non-uniform cross-section,
such as I-beams and H-beams. While the finished product is of good
quality, the surface is covered in mill scale, which is an oxide
that forms at high-temperatures. It is usually removed via pickling
or the smooth clean surface process, which reveals a smooth
surface. Dimensional tolerances are usually 2 to 5% of the overall
dimension. Hot rolled mild steel seems to have a wider tolerance
for amount of included carbon than cold rolled, making it a bit
more problematic to use as a blacksmith. Also for similar metals,
hot rolled seems to typically be more costly. TYPES OF HOT ROLLED
COILSHot Rolled Oiled Coils:Hot Rolled Coils are provided with a
special oil treatment to avoid scaling and rusting.Hot Rolled Oiled
Coils having a high coating ability, weld-ability and a glossier
finish. Hot Rolled Skin Pass Coils:Skin-passed rolling process is
done after the steel coils are hot rolled. The skin passed process
produces a smooth surface, and makes the thickness of the coil
uniform, reducing the yield-point phenomenon. Hot Rolled Black
coil: These coils are made from quality mild steel and having black
texture Hot Rolled Heavy Thickness Coils:Hot rolled heavy thickness
coils are the coils having the thicker dimension ranging from 6mm
to 20 mm.Hot Rolled Pickled Coils:The pickling process of HR coils
involves a 4 stage acid bath to remove the oxidized scratches and
improve the surface quality of steel. HR Pickled Coils have
increased formability, coating ability and weldability than regular
HR Coils. 5.2.2 WORLD HOT ROLLED COIL SCENARIOThe given graph, as
per the data collected by the world steel association, is showing
the production scenario of the hot rolled flat products, including
hot rolled coils, hot rolled sheets and hot rolled strips. The
approximate production of the hot rolled coil can be estimated by
looking at the overall production of hot rolled flat products
A.production of hot rolled flat product ANALYSIS Asia is the
leading producer of the hot rolled flat products, followed by
Europe and North America. Asia is showing remarkable growth in hot
rolled flat production in year 2010-11, where as North America is
showing fair and Europe is showing slight growth in the same. World
production of hot rolled flat products have been increased in
2010-11 after deline in the year 2009-10 B. EXPORT OF HOT ROLLED
COILS AND SHEET The world export of the hot rolled coils and sheets
is shown in the given graph. The approximate share of the hot
rolled coils can be estimated by looking at the total export of the
hot rolled coils and sheets
ANALYSIS Since year 2006, the export of the hot rolled coil and
sheet showing the declining trends till year 2009-10, but has
increased in year 2010-11. From the above graph, we can conclude
that the overall export of the export of the hot rolled coil has
been increased in year 2010-11
6. EXPORT POTENTIAL OF BILLETS AND HOT ROLLED COILS WITH FOCUS
ON MENAMENA (MIDDLE EAST AND NORTH AFRICA)The termMENA, for "Middle
EastandNorth Africa", is anacronym often used inacademicand
business writing. The term generally covers an extensive region,
extending fromMoroccoin northwest AfricatoIranin southwestAsia. It
generally includes all theArab Middle EastandNorth
Africacountries.Gulf Cooperation Council(GCC), officially
Cooperation Council for the Arab States of the Gulf, organization
(est. 1981) promoting stability and economic cooperation among
Persian Gulf nations. Its members are Bahrain, Kuwait, Oman, Qatar,
Saudi Arabia, and the United Arab Emirates. In 1991 the GCC
countries joined with Egypt and Syria to create a regional
peacekeeping force. An aid fund was also established to promote
development in Arab states; it was used to help liberate Kuwait in
1991. In 2003 GCC members eliminated tariffs on trade between
member nations and established common external tariffs. They have
agreed to establish a broader economic union (including a single
market and currency; Oman and United Arab Emirates have opted out);
a common market was established in 2008. Middle East & North
Africa Steel Market at a glanceThe Middle East and North Africa
(MENA) region is considered currently a key growth markets for the
steel industry at the consumption and production alike due to the
fast-expanding construction & fabrication sector. It has
witnessed major transformations over the past years, as Arabian
countries try to emerge from the shadows of the developed world and
become more industry oriented.Over the past couple of years, the
steel industry worldwide has been experiencing stunning growth and
the Middle East has flourished to become major players in the steel
market. The real estate sector has been at the heart of the demand,
as this sector witnessed tremendous activity. Consequently, steel
companies in the MENA region entered 2008 strongly, pushed by their
momentum and massive profits achieved in the previous year. In
2007, Egypt and Saudi Arabia ranked 27th and 35th, respectively,
among the worlds steel producing countries. These positions reflect
the substantial improvements that both countries underwent over the
years to enhance their steel making capabilities. Steel production
in the MENA region has been steadily increasing over the past two
decades to meet the Arab countries ever growing demand for steel.
In 1990, total steel production in the Arab countries amounted to
approximately 4mn tons. In 2008, steel produced by Arab countries
in the Middle East and North Africa amounted to 15.5mn tons.Steel
manufacturers in Arab countries are exerting efforts to integrate
and consolidate their position in the face of a growing worldwide
industry trend of mergers and acquisitions. There are 67 steel
plants in the Arab region. The demand for steel is rising at five
to six per cent every year. It is predicted that half of the
world's steel production will be done in Arab countries by 2012 and
Arab countries succeed in keep up with worldwide development in the
steel industry.The MENA region is considered to be among the top
five locations in the world to establish a steel factory, due to a
favorable environment and relatively cheap energy prices. 6.2 STEEL
SCENARIO IN MENA World Steel Association data shows that Global
Crude Steel Production fell by 7% in 2009, or by 21% with Chinese
growth excluded. Production in the Middle East increased by 6% in
2009, driven by a 9% increase in Iranian output while production in
North Africa fell 12% leading to production across the region as a
whole remaining unchanged. 2010 saw output in the Middle East
increase by 11% while that in North Africa rose by 18% with 2011
seeing Middle Eastern production rise a further 7% with North
African output falling by 15% following extensive unrest.
6.2.1 MENA crude steel production ANALYSIS The annual production
of the crude steel in MENA is rising at the faster rate, showing
the increased demand of the steel 6.2.2 Export of steel to MENA
Combined exports of Steel Mill Products (semis, long & flat
products, tubes) to the MENA region reached a record 48 million
tonnes in 2008. While exports to the countries of the Middle East
fell 22% in 2009 those to North African countries rose by 35%
leading to only a 9% fall in the total shipped to the region as a
whole. 2010 saw exports to the MIddle East rise just 7% on 2009
levels while exports to North Africa fell back 30% meaning that
total exports to the region decreased a further 6%. 2011 saw
exports to the region fall a further 6% to 40 Mt, including those
to North Africa down by 13%.
ANALYSISThe year wise analysis shows that the export of the
steel mills to Middle East has been declined as compared to year
2008Similarly the year wise analysis shows that the export of steel
mills has been declined as compared 2009 in north African
region.The quaterly analysis of the year 2011 shows that the export
of the steel mills products is increasing gradually in both in
middle east and north African region.The growth of the export
potential in middle east is growing at more faster rate than north
africa 6.3 EXPORT POTENTIAL IN MENAThe supply-demand imbalance
between finished steel output and apparent consumption in the
Middle East & North Africa (MENA) region is expected to widen
in the next few years. MENAs apparent steel consumption was
stagnant in 2011 due to political unrest in North Africa but should
grow 8% in 2012, according to Abu Dhabi based galvanised sheet
producer Al Ghurair Iron & Steel (AGIS).The Middle East has
become a highly diversified market, with 74% of the UAE and 89% of
Bahrains GDP being generated by non-oil sectors. The shortage of
finished steel output against apparent steel consumption is even
greater and this is expected to grow. In 2013, the regional
shortage of crude steel and finished steel will be 7mt and 14.2mt
respectively; this shows that there is room for expansion in these
areas.Facts and Opportunities:-By 2013, the regional finished
product demand is forecast to grow to 85.5mn tons with raw steel
production projected at over 50mntons. This massive imbalance
between supply and demand therefore means that the business
opportunities for those involved in the region's steel sector is
immense.-Middle Eastand Africa Oil and Gas Pipeline Industry
outlook to reach $15bn by 2012.-New investments in the Arab's
pipes, tubes and steel industries are expected to exceed by $20
billion between now and 2015.-The Middle East's construction sector
is expected to grow at an annual rate of 3.5% through 2015,
surpassing growth rates in the European and North American markets,
, As more and more investment is poured into buildings, real estate
and infrastructure developments
6.4 A FOCUS ON BILLET AND HOT ROLLED COIL Before going into the
details of the billet and HR coil export let us first have a look
over the respective products market. As we know that the billet
belong to the semi finished steel product and HR coil belongs to
long product, the graph here is showing the export trends of
overall long, semis, flat and tubes product
ANALYSIS The year wise analysis shows that the overall export of
the long product since 2008 has been declined in MENA, but
quarterly analysis is showing the growing trends in export of the
long products in 2011. The exports of the flat products showing the
fluctuating trends throughout the period of 2008-11 but quarterly
analysis shows the increasing trends. Similarly the overall demand
of the semis has been declined as compared to the year 2008
quarterly analysis reveals that the export of semis is growing as
well.6.4.1 BILLETS Billets are the key export product to both
Middle East and North Africa due to its potential to be re-casted
into various other finished steel products like rebar and others.
Hence billets along with other semi finished steel shows a great
export potential, particularly in MENA where infrastructure is on
the boom. The given graph is showing the annual billets and semis
imports to MENA. ANALYSIS The import of billets and semis has been
increased in year 2010-11 in Middle East, where as imports of
billets and semis has been declined sharply in North Africa Hence
Middle East could be a potential destination for the exports of
billets and semis in MENA. MAJOR BILLET AND SEMIS IMPORTING NATIONS
IN MIDDLE EAST Though most of the countries in the Middle East are
the billet importer but some of the them are showing the relatively
higher share, similarly in North Africa major importing nations are
few, though others are showing smaller share. 6.4.2 HOT ROLLED
COILSHot rolled coil are the one of the major element in the
construction, machinery, technical equipments, automobiles and
other infrastructural developmentsThe demand of HRC is increasing
in the MENA region which is getting fulfilled by their own
production and imports. The production trends of the flat steel
products can be used as the indicator to judge the production of
the hot rolled coils PRODUCTION OF HOT ROLLED FLAT PRODUCTS (in
metric tonnes) Region/year2009-102010-11
Middle East31853820
North Africa11521637
ANALYSIS The production of the hot rolled flat products has been
increased in MENA region as compared to the year 2009-10 In north
Africa also, the production of the hot rolled flat products has
been increased. The data shows that the overall production is
increased in MENA region, satisfying the increased demand of the
hot rolled flat products including hot rolled coils. 6.4.2. (A)
IMPORT OF HOT ROLLED COILS The import of the hot rolled coils can
be guessed by the data given below, which shows the total import of
the flat products in MENA ANALYSIS year 2010 shows a fair growth in
the imports of the flat products, showing that the imports of the
coils are growing as well. But just in 2011, the import of the flat
product declined, probably due to the expansion of their plant
capacity The overall import of the coils has been declined last
year but grew as compared to the year 2008 6.4.2. (B) MAJOR
IMPORTER OF COILS IN MENA The region which are the largest importer
of the coils shown in the graph, which represent the import of
the