Indian group to produce CRGO steel

Steel Authority of India is at talks with Japanese and Korean firms to produce value-added CRGO and CRNO steel. It has an over US$2.5 billion market, entirely met through imports now.

The Maharatna company would like to have a technological partner for the production of the two varieties. However, it is also open to the options of entering into a joint venture agreement with the prospective partner to produce the two, C S Verma, Chairman, SAIL said.

No Indian steel maker has the technology to produce CRGO steel, which is mainly used in power sector and CRNO, which finds application in the making of large dia pipes for oil and gas sectors, now.

Production of these value-added varieties would enable SAIL to increase its margin and help the consumers get them at a cheaper rate since they would no longer have to rely on imports to manufacture transformers and others within India.

Verma said that the current domestic market size for CRGO products would be USD 1.5-2 billion and the future growth is linked with the spurt in the power sector.

“If you look at the bottomline of Korean and Japanese firms, their profitability is higher than their Indian peers though they neither have coking coal nor iron ore deposits,” Verma said

“On the other hand, all Indian firms have access to iron ore, still Indian firms profitability is lower than Japanese and Korean firms. It’s because, value-added products are made very less in India compared to them,” he said.