The Hindu Business Line : NatSteel to expand capacity

Areas of growth
The expansion would be in downstream products such as wire-making, cut and bend reinforcement bars.
Vietnam, Thailand, Indonesia and the Philippines were countries with good growth potential, with Vietnam probably growing the fastest.

Recently in Singapore

NatSteel Asia Pte Ltd plans to expand capacity to 5-6 million tonnes a year of finished steel products from about 3.8 mt now.

The expansion will come about in the next five-six years and will largely be in Vietnam, the Philippines and Indonesia, according to senior NatSteel officials.

During an interaction with visiting Indian journalists at NatSteel's headquarters in Singapore, the officials said that demand for finished steel products was expected to grow in the Asean (Association of South East Asian Nations) region due to increased construction activities and NatSteel hoped to be able to capture a part of this growth.

NatSteel Asia, which was acquired by Tata Steel in 2005, makes steel products for the construction industry and has plants in Singapore, Malaysia, Thailand, Vietnam, the Philippines, Australia and China.

Its total capacity is two mt a year, while Millennium Steel Company of Thailand, which Tata Steel acquired in December 2005, has about 1.8 mt a year capacity to make steel products for the construction and automobile industries.

Downstream products

Mr Oo Soon Hee, President and CEO, NatSteel Asia, said the expansion would be in downstream products such as wire-making, cut and bend reinforcement bars.

In the region, NatSteel would focus more on Vietnam, Indonesia and the Philippines, where demand for downstream products was expected to grow substantially.

According to Mr T.V. Narendran, Deputy President - Operations, NatSteel, steel consumption in the Asean region was about 40 mt a year, a little more than half of which was long products mainly used in the construction industry.

Vietnam, Thailand, Indonesia and the Philippines were countries with good growth potential, with Vietnam probably growing the fastest.

Unlike in India, where the construction industry buys steel rods and fabricates them to their requirement at construction sites, NatSteel offers factory-made cut-and-bend reinforcement bars, wire mesh and prefabricated cages.

Mindset change

NatSteel officials say that the company will work through Tata Steel to bring these practices to the Indian construction industry. It has held discussions with large construction players such as Gammon India, Larsen and Toubro and the Shapoorji Pallonji group and has found them to be receptive to the idea.

The officials said that using factory-made construction steel called for a mindset change among the contractors.