India: Tata Steel ramping up capacity of scrap recycling plant

The Steel Recycling Business, Tata Steel, recently commissioned its first plant, located in Rohtak (Haryana), the first such facility in India. Branded scrap and an app-driven 24*7 virtual marketplace are some of the 'firsts' this business is offering. Yogesh Bedi, Chief, Steel Recycling Business, Tata Steel, tells SteelMint that the recycling business is providing the much-needed raw material fillip to the Indian steel industry, reducing the dependency on imports. Excerpts from an exclusive interview:

• Tata Steel's Steel Recycling Business recently commissioned the Rohtak plant. Please tell us more about it. What is the present capacity and how much do you plan to expand it to and by when?
  
  

Our first steel recycling plant of 0.5 mntpa capacity has been commissioned at Rohtak, Haryana. The plant has been set up in collaboration with Aarti Green Tech Ltd, as a 'build, own, operate' (BOO) partner. It is the first such facility in India, equipped with modern and mechanised equipment such as shredder, baler, material handler etc.

With the first unit templatised, plans are afoot to set up 3-4 such facilities pan-India.

• Please tell us more about the brands on offer and their benefits.
  
  

We have launched two new brands - Tata FerroBaled(R) and Tata FerroShred(R) for the baled and shredded ferrous scrap. Tata FerroBaled(R) has two variants, ie, King Bales(R) and Queen Bales(R) based on the dimension. These products are high quality processed scrap and they promise to provide the much-needed raw material fillip to the Indian steel industry by making available quality processed ferrous scrap and reducing the dependency on imports.

Both Tata FerroBaled(R) and Tata FerroShred(R) promise high cleanliness, low contamination, high bulk density, lower tramp elements and no radioactivity. The products are accompanied with 'test certificates', another first for the scrap industry, with value propositions like higher yield, better productivity, lower conversion costs, lower transportation and handling costs and overall a better quality.

These are first-in-the-world brands for scrap and the idea behind branding is to raise the bar of the scrap industry and deliver to a promise.

To what extent has the first-time scrap branding garnered excitement from buyers? Please tell us about your customers and sales volumes.

The high-quality processed scrap from our unit is supplied to electric arc furnaces, induction furnaces and foundries for downstream steelmaking.

The quality and branding of processed scrap have helped us create a point of differentiation for our products, ie, viz-a-viz other scrap available in the market, including imports. Both our brands have garnered good traction from the market.

• What is the source of the raw material and the volume being required?
  
  

The scrap is procured from various market segments such as end-of-life vehicles, obsolete households, construction and demolition, industrial etc, through an app, FerroHaat(R). It is a first-of-its-kind app in the world, to source steel scrap from the traders. It is a LIVE 24*7 virtual marketplace that enhances the ease of doing business for suppliers. It reinforces Tata Steel's commitment to fostering trust and transparency in a hitherto trust-deficit sector.

The scrap is processed through mechanised equipment and the high-quality processed scrap is supplied for downstream steelmaking. Volumes are being steadily ramped up to meet 100% capacity utilisation of the plant.

• What is the expected scrap demand in the next five years and what is the share Tata Steel is looking to garner in this?
  
  

As per the National Steel Policy, scrap demand is likely to increase at the rate of 4-6% to reach 40 mntpa by 2025 as the share of steelmaking through the EAF/IF route grows. Consumption of scrap in the primary route is also expected to increase due to sustainability concerns.

Tata Steel plans to set up 3-4 units by 2025. This is primarily a sustainability initiative with a focus to provide the much-needed raw material fillip to the Indian steel industry by making available quality processed ferrous scrap and reducing the dependency on imports.

• Tata Steel has been lifting a lot of scrap from the merchant market? What are the reasons when it has its own plant? Is any amount from the Rohtak plant being used for captive consumption?
  
  

Scrap being procured from the merchant market is for increasing the scrap charge in the Jamshedpur and Kalinganagar units.

• Where do you see global scrap prices headed in H2, and why?
  
  

I would not be drawn into speculation on prices. Suffice to say that scrap will have the last laugh! It never had so much focus and attention from the world!

Scrap recycling is one of the important routes for decarbonising steel production! Use of Green hydrogen is another route, but it is a while away from commercial reality.

So, suddenly, scrap is a hero and has got the tag of "future RM"!

There are various dynamics at play and it would be interesting to see how they pan out.

China shut down over 200 mn t of IF capacity a couple of years back. Now it is curtailing steel production because of sustainability concerns. It is not exporting scrap, rather, importing the same. It has set very ambitious targets for becoming carbon neutral by 2060. Europe has introduced the Carbon Border Adjustment Mechanism (CBAM) for importing any item produced through a non-sustainable route.

More and more countries would be taking a stance on sustainability as we go forward.

Interesting times lie ahead.