Tata Steel scouts buys for materials
In an effort to improve raw material security and enhance cost efficiency of its European operations, the world’s sixth largest steelmaker, Tata Steel, is actively looking at iron ore and coal reserves in Vietnam, South Africa, Brazil and Australia.business Updated: Aug 13, 2009 21:06 IST
In an effort to improve raw material security and enhance cost efficiency of its European operations, the world’s sixth largest steelmaker, Tata Steel, is actively looking at iron ore and coal reserves in Vietnam, South Africa, Brazil and Australia.
“Negotiations on various geographic locations are progressing on an on-going basis,” said a senior company official. “Ensuring raw material security is important for us and picking stakes in mines or acquiring them have been put on a priority. Mineral assets are relatively cheaper at current prices due to the global downturn.”
Currently, the Tata Steel Group is self sufficient to the extent of 25 per cent of its iron ore requirements but it is expected to go up to 62 per cent by 2015 once iron ore is
available from its overseas mines at New Millennium Corporation in Canada as also from Ivory Coast in the long term.
“Overall raw material security would reach approximately 50 per cent by 2015, increasing to around 60 per cent by 2018 from the current level of 25 per cent,” said Ratan Tata, chairman, Tata Group in the company’s annual report for 2008-09.
“For this purpose the company would be required to make substantial investment in a phased manner to secure raw material from its overseas mines. The company is also evaluating several other mineral projects in Brazil and Australia,” he added.
Tata Steel’s Indian operations are relatively better secured on raw materials with a 52 per cent self sufficiency on coking coal while iron ore requirements are totally met through captive mines.