India's JSW Steel Will Increase Production to 80% of Capacity

India's JSW Steel will increase production to 80% of capacity after the country's Supreme Court gave the go-ahead for the government-owned National Mineral Development Corporation to mine one million tonnes of ore every month in the southern state of Karnataka, JSW said on Tuesday. JSW Steel earlier curtailed production by as much as 35% by shutting down its corex furnaces after the Supreme Court on July 29 suspended iron ore mining in the district of Bellary, where the company operates a 10 million tpy steel plant. JSW sources most of its iron ore requirement from Bellary. It operates two corex furnaces each of 800,000 tpy capacity at its Vijayanagar plant there. The court suspended mining in the district after complaints of widespread environmental degradation and illegal iron ore mining in Karnataka's iron ore-rich Bellary-Hospate-Sundur belt. JSW explained its move in a press release issued on Tuesday. "In view of the suspension of mining and transportation of iron ore in Bellary district by the Honourable Supreme Court of India, vide its order dated 29/07/2011, the company cut its production by about 35% due to a shortage of iron ore," the release said. "Production in July 2011 would have been higher had the suspension of mining and transportation of iron ore not been in force. However, following the Honourable Supreme Court's order dated 05/08/2011 permitting NMDC to mine as much as 1 million tonnes per month, the company restored production to 80% of installed capacity," it added. JSW's total crude steel production for July increased by 4.53% to 599,000 tonnes month-on-month, compared with 573,000 tonnes in June. JSW's flat steel production for July was up by 4% at 424,000 tonnes, compared with 408,000 tonnes in June. Growth in long products for July was flat at 114,000 tonnes, compared with 115,000 tonnes in the previous month. On a year-on-year basis, JSW's crude steel production in July 2011 grew by 15%, compared with 520,000 tonnes in July last year. Flat steel production was higher by 3%, compared with 412,000 tonnes produced in July last year. A source at the company told MB that production in August is unlikely to be lower than July's, despite a 20% production cut, as the 2.8 million tpy blast furnace became operational. The source said that the corex furnaces will also be operational very soon as the Vijayanagar plant will source iron ore from eastern India to cover the shortfall from Bellary. "JSW Steel is the leading integrated steel producer in India, with steelmaking capacities of 10 million tonnes and 1 million tonnes at Vijayanagar in Karnataka and Salem in Tamilnadu, respectively. The requirement of iron ore to operate both these units at full capacity will be 18 million tonnes of ore with Fe content of 63%," a company release said. "In view of the partial relief granted by the Honourable Supreme Court, JSW Steel plans to operate its plants at around 80% capacity, with an expectation of further relief in the availability of ore from the Honourable Supreme Court of India to enhance capacity utilisation beyond 80%," the release added. Source: metalbulletin.com