The Hindu Business Line : ‘Quality management measures help Tata Steel cut production cost’

Kolkata, Dec. 17 Series of TQM (total quality management) initiatives over the past few years have helped Tata Steel reduce production cost so much that the cost of production of a tonne of saleable steel has dropped by an estimated 2.5 per cent, according to company sources.

The initiatives, as the sources point out, were launched right at the raw material stage. Thus, the improvement of the working of the coal washeries has brought down ash content in domestic coal, sourced from the company’s own West Bokaro and Jharia collieries, from 17 per cent to 13 per cent (West Bokaro) and from around 18 per cent to 15 (Jharia).

It has benefited the company in two ways. First, the company’s dependence on imported coal has declined. Earlier, the company used about 55 per cent domestic coal, now up to 70 per cent. Second, it has helped improve productivity of blast furnaces.

One per cent drop in clean coal ash leads to a cost saving of about five per cent in the production of hot metal and overall productivity improvement of about two per cent.

Another innovation has been introduced in the use of coal. Instead of lumpy coal, middlings and coal in small particles are being injected into blast furnaces as a result the costlier coke route has been dispensed with wherever possible.

In iron ore, Tata Steel is 100 per cent self-reliant. However, the quality, particularly, the high alumina content, as high as 2.5/2.6 per cent, has often been a matter of concern. It has been possible to bring down the alumina content to two per cent by introducing the jigging process.

All these exercises have been undertaken with one major objective — to achieve stability in the operations of the blast furnaces requiring consistently good supply of raw materials.

Tata Steel is modernising its blast furnaces largely with the help of in-house expertise, and the H furnace is considered the most modern in India. In fact, if the capacity of the Jamshedpur plant increased by about 1.8 million tonnes in the past one and half years, it is due to modernisation of the furnaces, the sources point out.

The company’s TQM initiatives, as the sources point out, are not limited to manufacturing processes only but also extend to selling finished products in a competitive environment.

The flat products account for 70 per cent of the production of Jamshedpur plant and the company, it is claimed, is the single largest supplier of skin panels for the automobile sector, accounting for an estimated 40 per cent of the market.

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