India’s steel production can go up to 500 M tonnes by 2050: BHP top exec – ET Infra

Production of steel in India could go up to 500 million tonnes by 2050, nearly four times the current output, as New Delhi seeks to undergird its evident growth ambitions with rapid capacity expansion for the primary infrastructure alloy, a senior executive at mining major BHP said.

The global mining company, which supplies energy needs for the world’s second-biggest steel industry next to China, could be a major growth partner as India expands its output to buttress rapid economic growth, said Vandana Pant, BHP’s chief commercial officer (CCO).

Met coal or coking coal is a key raw material used in the production of steel, and India is completely dependent on imports for this requirement.

“About 36% of India’s demand for met coal comes from BHP. It’s a big number. Every one in three tons of met coal that India consumes comes from BHP,” Pant told ET in an exclusive interaction.

For the world’s largest natural resources mining company BHP, around 40% of its met coal portfolio in Australia comes to India.

“It’s a symbiotic relationship and a huge relationship for us and for India,” Pant said. BHP counts India as one of its top three customers. “And India is just getting started on growth, so I see it as this is the starting point rather than the ending point for India,” she said.

India produced around 125 million tonnes of steel in FY23, which New Delhi plans to scale to 300 million tonnes by 2030, as per the National Steel Policy.

Even after accounting for a bit of a haircut, India can produce around 240 million tonnes of steel in eight years – double of what it does now.

“Iron ore, we think India has plenty of and very good quality, so it’s a real strength for India steel mills. But met coal, quality wise and that quantum wise is not something that would be available, so that’s where BHP can come in,” she said.

Coking Coal

With imports of around 69 million tonnes in 2022, India is one of the largest importers of coking coal. BHP currently has its footprint in coking coal, iron ore, nickel, copper and potash.

While it has traditionally had resources which bring in carbon emissions, the company now wants to focus on commodities which will be future facing – that is copper, nickel and potash.

“By the end of the decade, early 2030s, we’d like to see that the majority of our portfolio is future-facing commodities,” Pant said. The company is integrating decarbonisation in its M&A strategies.

For instance, in its last acquisition made for iron ore, South Flank, the company consciously baked in designs which would result in a higher proportion of lumps at the mine.

  • Published On Aug 1, 2023 at 07:45 AM IST

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