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"Outokumpu: A Stainless pillar to support Make in India and Zero Defect Vision of the Prime Minister"
Yatinder Suri, Managing Director & Country Head, Outokumpu India Pvt Ltd With a decade-old presence in the Indian Stainless Steel Industry, Outokumpu India Pvt. Ltd has played a vital role in strengthening qualitative aspirations of the end users in their quest to achieve the Zero Defect, thus contributing to their commitment of building corrosion free India. Speaking on the eve of successful completion of a decade serving the industry with its new age products and applications for stainless steel, Yatinder Suri, Managing Director & Country Head, Outokumpu India Pvt Ltd discusses about setting up well-known European brand in India, India's growing stainless steel demand, Duplex Stainless Steel solution, Global Sustainability Benchmark, Make In India initiative and company's future in an interview with Mittravinda Ranjan.

Congratulations on successful completion of a decade at Outokumpu India Pvt Ltd. Please share insight into the journey till now since its Indian establishment in 2006?

Please elaborate on challenges faced during the initial phase of setting up wellknown European brand in India?

In your opinion, what opportunities did India offered decade ago for MNCs like Outokumpu to enter the Indian market?

Outokumpu came to India in 2006 with new age products and applications that didn't exist in terms of wider product forms and specialty grades for hostile applications. From day one, we declared a war against corrosion in India. Naturally, so because if you trace the origins of stainless steel, you will find the same in Outokumpu.

The initial challenge was to create awareness about corrosion mitigation by using the new age products. We had to break the myth about stainless steel being expensive by enlightening the end user and educating the consultants and the decision makers on the competitive advantages they could derive. First few years were spent educating stakeholders, doing workshops, sharing ideas and knowledge through presentations, brochures and technical specification handbooks. We continue doing this even today since our advanced R&D set up keeps inventing new products and creating new applications every year.

From the first baby steps from New Delhi, we are now present in four locations i.e. Mumbai, Baroda, Delhi and Chennai - all stainless steel intensive regions. The stainless steel intensity in the eastern parts of the country is nascent so we are nurturing it from Delhi at the moment till it reaches the inflection point. Western India uses about 52 per cent of the total stainless requirement, 32 per cent comes from the Delhi area and around 15 per cent comes from the South which is growing pretty fast now.

The per capita use of stainless steel in India is less than 3 kg as opposed to that of >12 kg in China. The “Make in India” campaign will improve our manufacturing base and the need for stainless steel for industrial equipment will increase. Hopefully, in the next decade we can aim to achieve per capita mark of 5 kg.

In 2013, we celebrated 100 years of Stainless Steel by organising a conference in New Delhi with a theme – Building Corrosion Free India.

To be very honest, our presence in India in past decade has strengthened the qualitative aspirations of the end users in their quest to achieve the ZERO DEFECT and MAKE IN INDIA FOR THE WORLD vision.

Outokumpu caters to an array of manufacturing industry. Please share insight into the prospects of stainless steel in terms of infrastructure in India?

What assistance does the company provides to the local industry on its efforts to reach ever higher quality and efficiency standards?

Outokumpu offer the broadest range of stainless steels to meet the exacting standards of today’s emerging megatrends due to robust economic growth in India. Whether the application areas are in hinterland or the applications are onshore or offshore, upstream or downstream, we have the appropriate grade of stainless steel to neutralise the corrosive environment and retain the aesthetic beauty of infrastructure investments.

Our Duplex and Super-Duplex Stainless steel products offer profitable and competitive advantages to the project owners in Oil storage , chemical storage, distribution pipelines, Metro coaches, Railway coaches , Railway wagons , Road and Rail bridges , skywalks , Chemical tanker ships , Food processing, Desalination, water treatment , storage and distribution systems.

Duplex storage tanks have also been made to store oils and corrosive chemicals in tank farms at sea ports. Stainless steel is preferred for desalination of sea water into drinking water and also for drinking water storage and distribution for humans in safe and hygienic manner. Railway coaches, Metro coaches, wagons will become maintenance-free and lighter to save on haulage energy as well as wear-and-tear costs. Railway bridges along coastlines will also become maintenance-free with the use of Duplex stainless steel. As the nation upgrades to Euro VI in auto exhaust emissions, there will be a need for micro alloyed heat resisting grades of stainless steel from Outokumpu

These are some of the new applications we are supporting successfully for the emerging Indian infrastructure as well as smart cities.

Outokumpu stainless steel products have been used for decades in various oil and gas applications including flowlines, umbilicals, manifolds, heat exchangers, burners and flarers, structural components and safety systems As one of the largest suppliers of stainless steel for the oil and gas industry, we offer NORSOK approved Duplex and austenitic grades .

For subsea processes the areas, our stainless steel plays vital role:
  • Combatting corrosion in flowlines: CO2, chlorides, H2S, the formation of water condensate, as well as high flowrates and temperatures require the toughest materials, e.g. LDX 2101® or 2205.
  • Welded tubes for umbilicals: Welded stainless steel tubes have replaced seamless stainless tubes in recent years with LDX 2101®, 2304, 2205, SAF 2507® offering good choices.
  • Ease of welding and top durability for wellhead equipment and Xmas trees
  • As H2S rises, risk of SSC or hydrogen embrittlement requires LDX 2101® or 2205, which are also formable and easy to weld. Also possible are SAF 2507®, 254 SMO®, 1.4565 and 1.4529.
  • For topside construction the critical requirements areas are
  • Superior strength and minimum maintenance are required for blast, firewalls and living quarters where 1.4404/316L and 2304 offer the necessary properties, while 2205 is recommended for areas requiring even greater corrosion resistance.
  • True safety and cost-efficiency are needed for cable trays, stairs, tread plates and walkways. Although 1.4404/316L has become the benchmark, LDX 2101® and 2304 combine high mechanical strength and excellent corrosion resistance to form a far more economical choice.
  • For piping and related applications the functionality is critical in terms of:
  • Extreme performance is vital for main process piping where extreme conditions require extreme measures, for which 2205, SAF 2507® and 254 SMO® are perfect choice
  • Enhanced corrosion resistance for oil and gas coolers is needed since many of the tube heat exchangers in oil & gas coolers use seawater as a coolant. The enhanced corrosion resistance provided by 254 SMO® or SAF 2507® are ideal.
  • The fluids in manifolds are just as corrosive as in main process piping. When pressures are high, 2205 and SAF 2507® are perfect choices.
At higher temperatures and for better corrosion resistance, seawater piping with 254 SMO® and 1.4529 have been highly successful in systems operating at up to 30° C. Combined with 1.4565 for flanges or other parts prone to crevice corrosion, service temperatures can be increased.

Referring to some successful cases, for Al Shaheen oil field project in Doha , some of the pipes for sensitive sections in the top side equipment on the offshore platforms were exposed to very high corrosion, especially due to the aggressiveness of crude oil, the super-austenitic grade 254 SMO® was used.

Gansu Lanke Petrochemical Equipment of China has extended the service life of its oil refineries from 1-3 months to 2 years and beyond by using Outokumpu grade 2205 duplex stainless steel in plate air-cooler and plate shell heat exchangers.

Sosta used Outokumpu 2205 duplex stainless steel coil to manufacture welded Duplex stainless steel flow-line pipes for a natural gas flow line at the Burhan West field in Oman. The project is developed by Petroleum Development Oman.

In India too, looking at the diverse and on project experience of Outokumpu expertise, Outokumpu is in discussions with many local oil companies to opt for Duplex solutions. The outcome is very positive

As per World Steel Association report, India’s steel demand will grow at 5.4 per cent to 88.3 MT in 2017. In your opinion, what key growth drivers will fuel this demand?

With low oil prices, reforms and policies to increase infrastructure and manufacturing output. How brightening is India’s prospect as world’s third largest steel producer?

China’s slowdown has impacted its steel demand. According to you, how will it impact global market demand & India in particular?

Stainless steel production share is around 4 per cent of the total steel production in India as against the global average of 2.5 per cent. Sadly enough the per capita use in India is barely 2.5 kg as compared to 12 kg in China. This is because of our low share of manufacturing in GDP i.e 14 per cent only as compared to 44 per cent in China.

India needs to pursue accelerated substitution strategy to replace carbon steel with stainless steel to create surge in demand for stainless steel which will also eliminate the current over capacity in the long products as well as flat products segment.

There are over 400 grades of stainless steel which can be used for the diverse range of applications depending on the operational environment. In India the dominant demand comes from the utensils and kitchenware application segment which is using nonstandard grades with production share as high as 60 per cent. This is the lowest end application growing @ 6 per cent annually being catered to by over three dozen induction melting route manufacturing units as well as the four integrated manufacturing plants. This is also the grade which has seen flooding of imports. It is unfortunate that the stainless steel quality control order excludes this non-standard grade from its purview and thus the flood of imports in this non-standard grade continues unabated. This must be stopped if India wishes to succeed in its intent to serve the Make in India for the World vision. To become a hub for manufacturing quality products for the world, conforming to international standards is the first step.

The industrial and infrastructure applications constitute 35 per cent of the overall demand (around 800,000 tons per annum). As our economy is stepping up the GDP growth, stainless steel for industrial applications is observing the fastest pace of growth, as high as 15- 20 per cent. The capital goods segment is also enhancing its presence in global markets with stainless steel conforming to international standards. With banning of seconds and defectives by stainless steel quality control order, the demand of prime products will increase further.

Corrosion is a serious issue in India due to our long coast line of 7000 kms. Hence all steel related infrastructures must use stainless steel mandatorily. Almost 4 per cent of our GDP is lost to corrosion and being cash starved nation, we cannot afford the luxury of allowing infrastructure built with carbon steel to corrode. Corrosion Mitigation is a national priority now. Stainless steel usage will eliminate the extra cost of replacement or frequent repairs. Stainless steel is cheaper than carbon steel on life cycle cost basis.

In 2015, the Government had imposed an anti-dumping duty ranging from 5 to 57 per cent on import of cold-rolled flat products of stainless steel from China for five years. Please share insight into your thoughts on this?

The domestic stainless steel manufacturing industry is facing problems due to high level of imports at low prices as well as overcapacity which is as high as 50 per cent. In zeal to fill capacity, there is a downward spiral in prices which hurts every domestic mill in the long run. Imposing Anti-dumping duty on dumped imports is the fairest way to eliminate unfair competition due to dumping.

With reduced imports, the domestic players surely need to follow a responsible pricing strategy to improve their bottom lines. Product upgradation from plain Vanilla grades should also be a strategy to expand the pie.

Domestic sale and Import of Defectives, second choice stainless steel materials as well as products not conforming to International standards should be banned. This will automatically curb imports in a big way and create profitable demand for prime products from domestic mills.

The import duty structure should be logical to ensure that demand for domestic stainless steel from downstream end users is healthy and end users will also be protected from unfair dumping of imports.

There is no R&D capability in domestic stainless industry. Government should encourage co-operation between the global majors and local mills to upgrade domestic capabilities in the long run which will increase sale of domestic mills profitably.

India must follow BIS as well as international standards to ensure that Indian products travel to all regions of globe and serve Make in India for the World vision.

Over the last 3 decades, premature deterioration of reinforced concrete structures has become a serious problem globally due to corrosion of the embedded steel. How beneficial will stainless steel reinforcement solution prove to be for the industry?

How Outokumpu does plans to overcome the issue as well assist the industry with its Duplex Stainless Steel solution?

Outokumpu is committed to make India corrosion-free. India has extremely ambitious growth plans and infrastructure will play a pivotal role. The long Indian coastline of 7000kms faces the vagaries of highly corrosive environment. Duplex stainless steel is the answer and there are plenty of global success stories where duplex structural elements and reinforcing bars have been used to achieve more than 100 years of maintenance-free life.

The new application area of the stainless steel rebar usage along the coastal areas is an idea whose time has come. More logically for civil RCC structures in coastal and hilly regions, if stainless steel rebar is used selectively, the cost of the project could go up by less than 1 per cent, but the maintenance free life can go beyond 100 years. We have actively supported the preparation of a BIS standard with samples, test data and very soon the standard will be released in print.

The Outokumpu vision is to create a world that lasts forever; we are pursuing this vision aggressively in India as well. With the largest R&D set up, a wide range of high performance grades makes us a standout amongst the competition to cater to all process and environment conditions. Our willingness to share our 100 years of experience with end users is yet another impactful differentiator in the competitive arena.

As per Dow Jones, Outokumpu enjoys global benchmark in sustainability in steel segment. Please elaborate on company's varied sustainable initiatives in India?

What is the significance of stainless steel in the context of sustainability?

Sustainability has always been, and continues to be, a key element of our strategy. Stainless steel is 100 per cent recyclable, corrosionresistant, durable, hygienic material and the environmental impacts resulting from its use are almost non-existent.

Outokumpu strongly believes that stainless steel is the key building block for a sustainable future, playing an important role in the sustainable development of global infrastructure. New business opportunities are emerging from humanity’s growing demands for clean energy and pure water. Renewable energy solutions such as solar power, hydel power, biofuels and wind energy require components and materials that can be sustainably sourced and yield low life cycle costs. Stainless steel is an optimal choice in such areas.

We strongly believe that our integrated production routes with high proportion of recycled steel (>80 per cent), energy efficiency and low-carbon energy (>80 per cent) have enabled us to systematically decrease our products’ environmental footprint, making us one of the global leaders in sustainable stainless.

India being a developing country with limited financial resources needs sustainable infrastructure. Our innovative sustainable products have made Indian end users competitive in the global markets and even the domestic industry has gained knowledge from the products and applications which India is not capable to offer currently.

Our in-house research and development on products and processes is the largest in the world and has led to development of many new grades and applications. Being the oldest and emerging leader in stainless steel, we have so much to offer to India. The nation needs us and we are ready to do our best to build Stainless India.

Please share your views on "Make In India" initiative?

Stainless steel is the fastest growing segment of the metals industry, its applications are diverse and new applications are constantly being developed. The demand for the corrosion free metal is on increase. Indian stainless steel production is mostly in low end grades and applications which is a barrier to go global. R&D is an area where India needs support from global leaders like Outokumpu so as to develop capabilities to Make In India for the world.

We are well established in the Indian market as a leader in stainless innovations. Our Corrosion Handbook is a guide to the end users on material selection since it contains the wisdom we acquired in last 103 years of stainless innovations. The local competition is emulating us in developing new grades locally. Our presence strengthens and enhances the capability of local players to fulfil the Zero Defect and Make In India vision of the government. The Indian economy is embarking on a robust planned growth trajectory at the moment with strong positive trends to serve all regions of the world.

India and USA have signed a vision statement which aims to make India corrosion free. This is a very healthy development which will support our efforts to eliminate corrosion in infrastructure and industrial applications with improved metallurgical products. It is an ongoing activity and already there are many visible successes and milestone achievements.

What are the future plans of the company in India?

Outokumpu having been a leader in high performance stainless steels and running the most efficient mill serves the world with the full range of high performance stainless steel. With our expertise and experience in manufacturing advanced and sustainable materials, we are reducing the pace of consumption of our mineral resources in the planet and thus in a significant way making the world last forever.

Talking about India, the industrial and the infrastructure applications constitute 35 per cent of the overall demand (around 700,000tons per annum). Since the range of production capability of domestic integrated plants is rather limited at this point of time, imports are vital to meet demand for high end advanced materials for the accelerated infrastructure growth. Outokumpu presence in India is very relevant for the emerging high end grades and higher dimensions.

Being the oldest and largest stainless steel player in the world, we have positioned ourselves as the wise stainless men who are educating the domestic end users on new grades and applications and also giving new opportunities to the domestic mills to learn from us and upgrade their capabilities. We are here to grow by actively supporting and serving the Zero Defect and Make In India for the world vision.