Ruukki to fulfil high demand for special steels in India
“We make more than 2 million tonnes of steel a year. Our target is that 60 per cent of those 2 million tonnes should be special steel,” said Thomas Hörnfeldt, Senior Vice President – Special Steel Sales, Ruukki MetalsIndia is a competitive, innovative, and demanding market. In an exclusive interview with Dibyendu RoyChowdhury and Nisha Mane, Thomas Hörnfeldt shares why he is positive about the development in India, and how Ruukki is going to meet the challenging demand of Indian market.
What is the growth potential for your products in India?The potential as well demand for steel in India are huge. Even the portion of special steel is going to increase. It’s comparatively low steel in India, but you can see extraordinary growth in India. If people start to look for more energy efficient, more resource efficient solution, the demand will increase. We are quite positive about the development in India.
India is a cost-effective country, and as your products are already quality products, how do you take care the cost according to the Indian clients?Well, India is a cost comparative but high-value country. When it comes to the raw material for steel, coal, iron ore, or energy, we pay almost same around the world—whether it is Australia, North America or Europe. The amount of man hours involved in steel making is also comparatively small in India. We also have to remember that we are an efficient steel company. We sell special steel products in India, and everybody can’t make them. We keep our knowledge in place. We only make 2 million tonnes, but we put a lot of efforts and knowledge in those 2 million tonnes, so the transportation cost that we are looking is small in the total picture. It’s more important to be flexible and efficient in serving our customers.
What is the demand of these two products in Indian as well as in the global market?We make about 2 million tonnes of steel. Our target is that 60 per cent of those 2 million tonnes should be special steel. In the global market, that is a little more than 1 million tonnes. India is still relatively small, but we are quite happy with our share of the Indian market. Like I said that the demand is still growing in India for this type of products.
You don’t have any major competitor for your product, how do you look at this?To the extent, certain categories of materials, we are the most cost-effective, fastest supplier for the special steel products. We are very happy to have a strong position in the Indian market. Of course, our objective is to maintain and build it. I think everybody is understanding the growth potential in the Indian economy and building the infrastructure. Our target is to keep that position and capitalise on the growth potential. We are dedicating a lot of resources to R&D and technical support to ensure customers get the full benefits from our special steel products. So in a way, we are working to increase the size of the market. Hopefully, we will keep that position.
The overall market was low in the last one and half year. The government’s new investment plan for the infrastructure brought some hopes. How are you going to take the best out of those policies and investments?First, it’s our customers whom we call our partners, and we have a very close cooperation which is a big advantage. We are helping our customers by offering wear-resistant and high-strength steels instead of standard steels. A lot of our steels go to the lifting, transportation and material handling sectors because that’s where the applications are. The machinery industry is related to infrastructure one way or the other, so we are big fan of infrastructure investments.
How did Ruukki perform in the last year?The market was slow in India and China, and Europe was having difficulty. At the same time, Ruukki has a strong presence outside Europe. We have been opening offices in North and South America last year and want to strengthen the Asia-Pacific region. A lot of those markets are expanding and compensating for the rest of the market.
Anything else you would like to share about Ruukki?We provide more and more material efficient design to our customers. We, of course, reduce the need for steel in the work and speak about energy-efficient solution in Ruukki. Every country around the world — including India — has been increasing the concern about the CO2 emission. We are working with scarce resources in the world, and it’s important for us that we not only help our customers by saving material and energy but also have an energy-efficient manufacturing process. Compared to the European average, Ruukki’s steel production generates around 300,000 tonnes a year less CO2 emission. This makes us proud.