India's steel industry will face several challenges as the nation is poised to become the next driver in regional economic growth, keynote speakers said at the Indian Steel Association's inaugural Steel Conclave Conference at New Delhi on Thursday.
Challenges like the high cost of raw materials, including coking coal and thermal coal, transportation networks and infrastructure, and the quality of steel, were brought up by leaders in the major Indian steel mills.
Anil Chaudhary, Chairman of Steel Authority of India Limited, said that India aims to produce 300 million tonnes of crude steel capacity by 2030-2031, up 130% from the current capacity of around 135 million tonnes. This was echoed by Naveen Jindal, Chairman of Jindal Steel and Power Limited, who added that India's per capita steel consumption is merely at 68 kg compared to world's average of 208 kg.
As India look to increase crude steel production capacity and per capital steel consumption, this would mean greater demand for coking coal. However, India does not have a reserve of coking coal and hence will be depending on imports "Not only is coal expensive, supply is also falling short and we need to work out some alternatives" Chaudhary said.
According to S&P Analytics, India's coking coal demand is estimated to hit 70 million mt by 2020. This would mark a 25% increase, or an increment of five million mt/year, in metallurgical demand from 2017 levels. Monthly metallurgical coal demand is therefore forecasted to trend higher towards six million mt at the end of 2020.
"India would finish 2018 by being the world's number two steel producer," Chaudhary Birender Singh, Honorable Union Minister of Steel, Government of India said. India surpassed Japan to become the world's second major steel producer in the first eight months of this year.
