AM/NS India adds 0.5 mtpa of automotive steel output

ArcelorMittal Nippon Steel (AM/NS) India has commissioned a new modern Continuous Galvanising Line (CGL) to produce advanced high-strength steel at its Hazira plant for automobile sector.

The new line will take the overall capacity of the company’s downstream products by 0.5 million tonne per annum (mtpa) to 3.3 mtpa and this will be further increased to 5 mtpa with the commissioning of two more line by this year-end.

In 2022, the company planned to invest about ?8,500 crore in the five galvanising lines at Hazira and has already spent about 85 per cent of the planned capex.

The new high-strength galvanised steel will be an import substitute and almost all the automobile companies have lined up to buy it, said AM/NS India.

Currently, the steel demand of the automobile industry is about 8-9 mtpa. Of this, 15 per cent is imported and this can come down to nil with the launch of series of patented products of ArcelorMittal and Nippon Steel, said AM/NS India.

The new CGL is equipped with cutting-edge technology derived from the deep global expertise of its parent companies – ArcelorMittal and Nippon Steel, it added.

Value-added products account for 60 per cent of the overall sales of AM/NS India, which is gearing to launch all the patented products of its parent.

The company will also commission a separate high-end product line for catering the growing demand in the utensils segment.

Dilip Oommen, Chief Executive Officer, AM/NS India, said the commissioning of CGL and upcoming facilities are designed to produce steel that matches the quality of offerings currently available in developed nations.

The Indian automobile industry will be the major beneficiary as they do not have to book their orders in advance, incur huge freight cost and get exposed to foreign currency risk and enjoy the just-in-time inventory management which itself will be a huge cost savings, he said.

The company plans to enhance production capacity to 15 mtpa from 9 mtpa, with ultimate goal of reaching 24 MTPA of upstream and downstream steelmaking capabilities at its Hazira plant.

Separately, the company plans to set up an integrated steel plant in Andhra Pradesh where it has already commenced the land acquisition process. Plans are also on track to set up integrated steel plants in Odisha, where the company has a significant presence.