One of India’s leading steel mills, JSW Steel, with around 21 million tonne (mn t) of current crude steel-making capacity, will go for a 75-day maintenance shutdown of the steel melting shop (SMS) at its flagship Vijayanagar works, beginning 15 Jul’21, SteelMint has learnt from reliable sources.
The “planned” move will stretch over three periods of 25 days’ of shutdowns punctuated by two 10-day “cooling off” periods. The total shutdown will thus continue till almost end-Sept.
Importantly, the shutdown will lead to more than 2.50 lakh tonnes of production getting impacted with 3,500 tonnes per day of output loss to be incurred.
SteelMint also learnt that it will be mainly flat products output that would be impacted. India’s total HRC capacity is at almost 47 mn t per annum. JSW Steel’s share in this is at around 14 mn t, with Vijayanagar’s capacity alone at 9.2 mn t, Dolvi’s at 3.5 mn t and JSW BPSL’s at 1.8 mn t.
Additionally, if the SMS/basic oxygen furnace (BOF) undergoes maintenance, sources informed, Vijayanagar’s blast furnace (BF) capacity too, in tandem, ideally could be reduced during that period. However, reducing/re-adjusting BF capacity is a complex affair and thus JSW Steel would have the option of obtaining pig iron from the BF for selling in the market. However, SteelMint was unable to confirm this aspect till the time of publishing this news.
The SMS shutdown will have a ripple effect on other downstream or subsequent segments like the hot strip mill etc. “The hot strip mill-1 (HSM-1) is undergoing maintenance shutdown for 40-50 days. HSM-1 will be operated at 50% capacity for two months and 50% will remain shut from 15 Jul-15 Sept’21. Thus the losses will be around 2.5 lakh tonne in two months,” a source informed.
Meanwhile, HSM-2 is facing a breakdown and will remain closed for 10 days, the source added. The loss in production from HSM 2 will amount to 80,000-90,000 tonnes (t).
HSM-1 has a commissioned capacity of 3 mntpa and HSM-2, 5 mntpa.
Export and domestic orders not to be impacted
However, supply commitments, including export orders, will not be affected, it is heard.
Vijayanagar is JSW Steel’s largest plant so HRC production will be impacted to an extent for the next couple of months. However, market sources feel, although mills do not have a fixed time of the year for their annual maintenance shutdown, now is the best period for any mill to do so since domestic demand is sluggish and exports also look somewhat down at the moment, especially in flats.
~Madhumita Mookerji
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