TATA Steel Kalinganagar to be lower cost steel producer than Jamshedpur
Business Standard reported that TATA Steel’s Kalinganagar in Jajpur district of Odisha is set to become a lower cost steel producing centre compared to the company’s other integrated steel facility at Jamshedpur. Mr T V Narendran MD of Tata Steel said that “Between Jamshedpur and Kalinganagar, the latter will eventually become a lower-cost producer of steel because of the comparative advantage of logistics though in the initial days, it has to deal with high depreciation cost for being a new plant.”
The saving on logistics at Kalinganagar is thanks to its proximity to the Paradip. Kalinganagar is only 118 km from Paradip, whereas the distance between Jamshedpur and its nearest port, Kolkata, is 270 km. This is in addition to the advantages it enjoys for being a new-age plant that gives it scope for judicious deployment of personnel and use of modern technology.
He added that “Our aim is to take the per-employee output to over 2,000 tonnes of steel to compete with global leaders like Posco, whose per-employee steel output stands at 2,300 tonnes.”
At present, Tata Steel’s Jamshedpur plant, oldest steel mill in the country, compares unfavorably with some of the new age steel plants in the private sector from a cost point of view. With a capacity to produce 10 million tonnes per annum of steel, it has a work force of 37,000.
JSW, which produces 14.3 million tonnes steel annually, has a workforce of 12,271 employees.
Source : Business Standard