With market started looking up, JSW Steel today said it will double the capacity utilisation at its US-based plate and pipe mills to 30-40 per cent over the next three months, and accordingly not considering to temporarily close them down.
"We have decided not to close down the mills. However, we will operate them at low capacity," JSW Group's chief financial officer MVS Seshagiri Rao said here.
The private sector steel major had on May 19 indicated that the mills could be closed down for three months starting from June and upgradation and maintenance works would be carried out in the interim expecting better times ahead.
"There is a slight revival in order flows for plates. We have received a small order for pipes as well. Things are better now," Rao said, adding stability in the oil price at USD 70 per barrel augured well for the mills.
JSW Steel is currently running the mills at 15-20 per cent capacity.
"A decision has been taken to increase the capacity utilisation to 30-40 per cent over the next three months," he said.
Rao said apart from the US market, the company was looking at selling pipes and plates in Africa and Latin America.
"We will submit bids in these markets."
Sajjan Jindal-run JSW Steel had acquired the mills in the US in November 2007 for USD 800 million from Jindal Saw, owned by his elder brother P R Jindal. These mills have 1.2 million tonnes of plates and 0.5 million tonnes of pipes making capacity in a year.
The company had recorded USD 74.63 million EBIDTA in the six months ended September 31, 2008. Subsequently, the crash in oil prices to less than USD 40 per barrel and the recession in the US economy forced JSW Steel to cut down production from October 2008 due to the lack of demand.
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