Essar Steel

By Steel 360 Bureau

Integrated steel producer Essar Steel is looking to increase the share of its value-added products to touch 60%, going forward, from the present over 50% revenue being generated from this category, it is learnt from market sources.

The whole idea is to move away from the commodity grades into the value-added segment where the competition is less. These are niche products meant for a particular customer.

This year, source said, Essar Steel has developed heavy engineering and Defence sector products. Its steel is being used in warships at present as well as in bullet-proof steels, armoured vehicles, battle tanks etc. These are very special grades being developed for the first time in the country. And, probably, sources said, the company will provide the largest product range for Defence sector applications, looking into the future.


There was a 42% increase in its niche product sales in financial year 2017-18 (FY18) compared to FY17, supported by the implementation of regulatory norms (BS IV) in the automotive sector from April 1, 2017. The usage of high strength steel will continue to increase further at Essar Steel with the implementation of stringent BS VI norms in 2020 and the company has ensured that it is fully equipped to meet the challenges.


Essar Steel offers products across 300+ grades which match the most demanding standards like the API, ABS, NACE, Lloyd’s Register to name just a few. Its products conform to international quality standards and it is the approved supplier to reputed clients both in India and abroad.


In-house Product Development

In terms of in-house product developed, Essar Steel will be expanding in this space because as and when customers require special grades of steel, Essar Steel keeps developing such grades for them and then it commercialises the same, as per a source.


Currently, one third of the company’s revenue comes from products generated in-house. This will further expand as the company develops new grades of steel.

Essar Steel, as per sources, has the widest range of steel products encompassing over 300 grades of steel and value-added products.


Value-added Push

Margins in value-added products are always higher since these are not run-of-the-mill products but customised. Hence, today, all the major steel payers are paying a great deal of attention to expanding their value-added portfolio. Ferrous value-added or niche products typically include cold-rolled close annealed (CRCA), electrical steels, galvanised coils/sheets, colour coated coils/sheets, tinplates etc. Most of the Indian steel majors are still definitely lagging in the areas of R&D to develop high-end products which can compete in developed countries like Europe, Japan, the USA and Korea.


Although Indian steel majors are gradually making a mark in establishing their branded products in construction and engineering applications, for high-end applications like automotive, electrical appliances and electrical steel (CRGO), consumers prefer to use imported steel, said a source.

However, sources indicated that the drive towards developing niche/customised/import substitution products has created a significant impact in the industry. “Many of the developments have happened for the first time in the country and Essar Steel has been a pioneer in developing these and being the sole supplier of these products in the country,” a source said.


Focus On Improving Production Efficiencies

Essar Steel’s key focus is on improving production efficiencies and driving towards achieving the plant’s rated capacities. In 2018-19, it produced 6.8 MnT. This year, it is targeting 7.2 MnT.

Essar Steel India is one of India’s leading integrated steel producers with an annual production capability of 10 million tonnes (MnT), supported by a 20-MnT pellet-making capability. The state-of-the-art facilities comprise iron ore beneficiation, pellet making, iron making, steel making, and downstream facilities, including a cold rolling mill, a galvanising and pre-coated facility, an extra-wide plate mill, three pipe mills with coating facilities, and steel-processing facilities.


Its steel-making facilities are strategically located at Hazira, which has an annual production capacity of 10 million tons per annum (MTPA) and comprises three iron-making facilities of DRI, Corex and blast furnaces, which offers flexibility in the use of raw materials. It uses two steel-making technologies – EAF and Conarc and two rolling facilities of HSM and CSP.


Pipe mill, Hazira: The pipe mill has an annual production capacity of 0.6 MTPA and produces both HSAW – 0.275 MTPA, and LSAW – 0.325 MTPA pipes. The mill has a distinct advantage in terms of easy access to raw materials as it is located within the Hazira complex.


Plate mill, Hazira: The plate mill is one-of-its-kind with a capacity of 1.5 MTPA and is one of India’s widest plate mills, producing five-metre wide plates. It is the first Indian private mill to be approved by Defence authorities for commercial production of certain steel grades for armour and naval applications.


Essar Steel Pune Facility: The ESPF is strategically located near Pune, one of the largest industrial hubs in India. ESPF manufactures a wide range of value-added products catering to different customer segments across both domestic and international markets.


Pellet facilities: As one of the critical inputs for its steel plant at Hazira, it is the largest pellet producer in India with a capacity of 14 MnT with another 6 MnT pellet capacity under completion. It operates two pellet facilities – one each at Visakhapatnam, Andhra Pradesh and the other at Paradip, Odisha. The pellet plants produce DR and BF grades of pellets using iron-ore fines.



Meanwhile, a bankruptcy appeals court has dismissed a plea challenging ArcelorMittal’s eligibility to buy Essar Steel India Ltd, clearing the way for the world’s largest steel maker to establish a meaningful presence in India after months of legal battles.

Earlier, the appellate bankruptcy court had approved ArcelorMittal’s INR 42,000-crore offer for Essar Steel, rejecting its former promoters’ claim that the Luxembourg-based steel maker was ineligible to acquire the Indian company.

Some of the recently developed and commercialised products at Essar Steel:

Some of the recently developed and commercialized products include;

  •  Hot rolled high strength steel S650 MC (Essar brand: TUFMAX 650) and S700MC (Essar brand: TUFMAX 700) for chassis of automotive commercial vehicles. This is the first ever instance of successful application of high strength steel for chassis of commercial vehicles in the country.
  • Stretch Flangeable Steel – JSH 590B used in automotive passenger vehicles.
  • Hot forming grades of steel for automotive structural components as a substitute to continuous annealed products (CAL) and precision tubes of grades 20MnB5 (Essar brand: BOROSTAR 20), 22MnB5 (Essar brand: BOROSTAR 22), 26MnB5 (Essar brand: BOROSTAR 26), to name a few.
  • Hot forming grades for agricultural equipment 27MnB5 / 30MnB5 mainly targeted at the European markets.
  • Thinner gauge (2.3 mm – SPFH 540) hot rolled pickled and oiled products designed for the ever-growing automotive wheels segment.
  • SOLGAL – Essar branded galvanised product in higher zinc coating of 550/600 grams per square metre.

Image Credit: Google