JSW Steel’s new 8-million tonne (mn t) pellet plant at its Vijayanagar works is likely to start production from March-end, a source informed.
“Puja was performed for the third (new) pellet plant and production is expected to start sometime this month,” the source indicated.
Earlier, in the annual report for 2019-20, Chairman Sajjan Jindal had said the 8 mtpa pellet plant and the wire rod mill at Vijayanagar are expected to be commissioned by mid-FY21. However, Covid-19 delayed plans. It may be recalled that Finnish industrial machinery company Metso had bagged the order to deliver the pellet plant that includes grinding, filtration and a pyro-processing plant. The plant is suited for large-scale operations and is part of JSW Steel’s larger plans of touching 40 mn t of crude steel production by 2025 and reducing the dependence on expensive iron ore.
The previous two pellet plants are also located in Vijayanagar, with a combined capacity of around 9.2 mn t pa. That apart, as per information available to SteelMint, the steel major has other pellet plants directly and indirectly owned across its various works, with the total pellets capacity adding up to more than 21 mtpa, including 4 mtpa at Dolvi, 3.5 mtpa at BPSL, 2.2 mtpa at Monnet Ispat and 2.4 mtpa at BMM. Technically, BPSL, Monnet and BMM are still not under JSW Steel, the listed entity.
Sizeable export volumes in Apr-Feb
Nearly 30% of JSW Steel’s total sales from its flagship Vijayanagar plant in the period April 2020-February 2021 were in the form of exports, the balance being domestic, sources informed SteelMint. During the period under review, the steel major’s hot metal production from this sprawling flagship plant touched almost 9.5 mn t and sales were in the vicinity of 9 mn t in which export sales touched a sizeable 3 mn t.
The reasons are not far to seek. It may be recalled, during the Covid-19-induced lockdown last calendar, steel mills had to keep running being an essential service but demand was nil. Mills had no other option but to fall back on exports to keep their fire burning from May-September, 2020 with overall steel exports touching a peak of around 2.49 mn t in July last year.
March sales target
Meanwhile, the company has set a total sales target of above 9.5 lakh tonnes for March for vijaynagar plant. In February, total sales had touched 8.50 lakh tonnes in which the share of exports were a little above 2 lakh tonnes. In fact, February exports were up more than 45% month-on-month against January what with the domestic market not showing much promise at that juncture. Domestic sales declined m-o-m by around 15% in February.
As per sources, in March, the plan is to increase exports to around 3 lakh tonnes while also increasing the share of domestic sales somewhat from the around 6.20 lakh tonnes seen in February.
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