What
has prompted Tata Steel to look at the ferro-chrome business
as an area of opportunity? Over a period, it has strengthened
its presence in this industry. What are the reasons?
Tata Steel's involvement with the chrome business goes back
to 1949 when its geological team discovered high-quality chromite
ore in Sukinda Valley. In the last 50 years, Tata Steel has
strengthened its position in the chrome industry by progressive
value-addition, in terms of beneficiating low-grade chrome
ore for producing chrome concentrate, and production of ferro-chrome.
Chromium is utilised as an alloying element in stainless steel
and carbon steel. Stainless steel, as a metal, has outperformed
the average growth rates of other metals for the last two
decades. We expect that this industry will continue to grow
consistently, and as a result, there will be consistent growth
in the ferro-chrome industry too. This, with high-quality
reserves and excellent infrastructure, is the key reason for
us to have long-term plans in this industry.
What sets Tata Steel apart from other ferro-chrome producers
in India?
Globally, Tata Steel is the largest exporter of chrome ore
and concentrate. The company has established itself as a credible
and quality-conscious supplier across the globe and this is
evident by the 'main producer' status that it enjoys with
major stainless steel plants in Japan and Europe. It is the
only Asian company to enjoy this status.
The marketing network of the company is very good and the
mine in Sukinda Valley is well developed. The people involved
in mining, beneficiation and production of ferro-chrome
are highly skilled and capable.
What factors led to the selection
of South Africa as the company's first overseas location?
How was the choice determined?
South Africa is ideal for the production of ferro-chrome
primarily due to two reasons: cheap electricity and dominance
of South Africa in the ferro-chrome industry (South Africa
produces around 55 per cent of the world's total ferro-chrome).
The plant at Richards Bay in South Africa aims to create
a sustainable business.
As for choosing the destination, Tata Steel evaluated the
status of its chromite business in a systematic manner.
Based on initial screening and detailed assessment thereafter,
South Africa was chosen as the most appropriate destination
for this project. The focus of the search then shifted to
selecting the most appropriate location, where the plant
could be set up. Cheap power, lowest overall logistics cost,
efficient and developed port facilities, developed base
for technology and equipment supply and financial incentives
were the key reasons for selecting Richards Bay as the location
for the plant in South Africa.
What are the future prospects
of the project? When is production expected to commence?
The ferro-chrome project is one of the very first steps
that Tata Steel has taken in South Africa. The production
for phase-I will commence in the last quarter of 2007, and
we plan to double the capacity of the ferro-chrome plant
within two years of completion of phase-I. Additionally,
Tata Steel (KZN) may also create a beachhead for various
other initiatives in the field of manganese and coal in
Southern Africa.
What are the path-breaking environment
management initiatives planned for the plant?
In terms of the construction of plant, some of the environmental
mitigation measures taken by Tata Steel are a first in the
industry. All the fine material in the plant will be stored
in a raw material shed, which will help in curbing wind
blown dust emission. There is 100 per cent standby capacity
in the gas scrubber, and the pollution control dams are
lined suitably to prevent any contamination with groundwater.
The removal of natural vegetation for the development at
the site will be confined to a minimum in order to leave
habitat in its natural state. Additionally, a comprehensive
environment management plan will be followed for the construction
and operation phase. All these mitigation measures will
ensure that this plant is the cleanest and most environmentally
suitable plant globally.
How will the project add value
to the company's ferro-chrome business?
Tata Steel is an established player in the field of chromite
mining, beneficiation and manufacturing of ferro-chrome.
The project in Richards Bay will further build on the strengths
of the existing business strengthen the existing businesses.
Due to the location of Richards Bay, it will also be possible
to service some of the customers in the European and American
markets, which was not feasible from India considering the
economies of scale and logistical disadvantages. The annual
off-take of chrome concentrate will also increase and stabilise.
Overall, Tata Steel will acquire a position of eminence
in the chrome business through this project.
Have you planned any CSR activities
in the near future in the vicinity of the plant?
Tata Steel has constantly strived to work towards the betterment
of the communities and society. In line with the company's
policy, Tata Steel (KZN) will identify key projects to work
for, in close association with the uMhlathuze municipality.
Initially, Tata Steel (KZN) will support the existing initiatives
taken by the municipality and other government agencies,
and in the long term, develop more sustainable projects
to carry out such programmes. The two key areas in which
the company will be actively involved are - skills development
through suitable training programmes, which will help in
fighting unemployment, and educational programmes with local
communities to fight HIV-AIDS.
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