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Belgian town grateful to L N Mittal

May 03, 2010 12:34 IST

In China, say you are Indian and the response is usually a rapturous rendering of Bollywood songs. In the United States the same statement elicits talk of IT and software. But in Belgium, the word "India" is most often coupled with steel and one name: Mittal.

In economically-depressed Wallonia, the southern part of the country, I visited the workshop of the once world-renowned crystal makers Val Saint Lambert. "You're from India? Perhaps your article can persuade Mittal to come visit our shop," said the company's marketing head, gesturing in the direction of the near by ArcelorMittal plant in the city of Liege.

A day later, I was up north in the Flemish city of Ghent talking with the port authorities about their plans to expand cooperation with counterparts in India. "We specialise in steel," said the port's commercial director, "and we should be the natural choice for any Indian steel company." He paused briefly and frowned before quickly adding, "Although I don't want to offend Mittal. Perhaps we shouldn't encourage the competition."

The port's concerns were rendered intelligible by the fact that the single steel plant of ArcelorMittal in Ghent accounted for one-third of its business. On an average year, the plant ships in some 10 million tonnes of raw materials like coal and iron ore and ships out a third of its finished products to destinations around the world.

One of the largest private employers in the country, with close to 5,000 people on its payrolls, ArcelorMittal Ghent is a behemoth of crucial importance to the local economy. It is Europe's largest integrated steel plant with a capacity to produce 5 million tones of flat carbon steel a year.

It looms over the Ghent port's skyline like a gnarled, steaming, creature, fed fat with fire and coal. Reverberating with the grime, heat and iron clang of old-style industrial production, it is a universe away from Europe's dominant office-based, white collar environs.

The site holds within it blast furnaces, coking plants, steel shops, hot strip mills, cold rolling mills, sinter plants, coating lines and vast areas to store the hulking hills of raw materials shipped in every day.

Iron ore is heated in sinter plants to separate the oxygen from the ore, converting it into sinter. In the coking plants, it is coal's turn to be heated into coke before it is mixed with sinter in the blast furnaces at temperatures as high as 1,200 degrees centigrade. Here the carbon in the coke works to remove the oxygen in the sinter, and the resulting hot iron or pig iron emerges comprising 96 per cent iron and 4 per cent carbon.

The remaining carbon is removed in the steel shop through the process of converting it into liquid steel which is then formed into slabs, before being sent to the hot rolling mills to whittle down its thickness.

It is an exhilarating process to watch. Steel is so much a given of everyday life. The constituent element of everything from cars to home appliances, the keys with which we lock our doors, the trunks in which we fold away clothes, the knives with which we cut our bread. And yet, rarely do we pause to consider the formidably inventive and complex process through which it is cast into this world.

Inside the steel shop in the Ghent plant steam rises up in gigantic, balletic puffs. I feel the heat coming off the liquid iron as it is constituted into slabs even from several storeys up. The slabs burn with a bewitching intensity, compelling the eye to marvel at their elemental fury.

They glow with a precious beauty, highlighted by the gloomy, mechanical surroundings in which they are born.

Like molten jewels, it is in this proto-steel avatar that they stand most clearly as a testament to humanity's genius. And yet, as with all other heavy industry, the steel sector is in the process of taking out the humans from the production process, to gain the efficiencies required in a competitive world. Many of ArcelorMittal's cranes for example are already fully automated and this is a trend that will continue. The steel industry has been among the industrial sectors worst hit by the recession, with global shipments falling 8 per cent during 2009. Tapering demand from the automotive and other steel-intensive sectors led to a 29 per cent drop in ArcelorMittal's worldwide steel shipments last year, which declined to 73.2 million tonnes, down from 103.3 million tonnes in 2008.

The Ghent plant was running at half capacity for several months last year, and one of its two blast furnaces was closed between November 2008 and July 2009. The workforce was reduced from 5,300 to its current levels of 4,700 and the plan is to cut it further to 4,300. These changes are needed to cut costs despite the fact that the crisis has for the most part been weathered. In the first quarter of 2010, ArcelorMittal Ghent produced 1.1 million tonnes of steel, back up close to capacity. Indeed the group as a whole has done well, in part due to its relative self sufficiency is procuring raw materials. The latest figures for 2010 show worldwide first quarter results at 21.5 million tonnes, up 8 per cent from the last quarter of 2009.

Nonetheless, for ArcelorMittal the future is not crystal clear. With concerns related to global warming reaching fever pitch in Europe, old-style, polluting industries like steel have a battle coming up. In Ghent this face-off is made tangible by the row of long-necked wind mills that rotate across the canal from the blast furnaces of the AreclorMittal plant. Europe is determined to go green, and steel, for all the improvements in technology over the years, remains stubbornly coal-black. But future challenges notwithstanding, for the moment steel remains the backbone of several economies across Europe and is the beneficiary of generous free allowances under EU's carbon trading scheme. And so it is that in Belgium "Mittal" remains synonymous with jobs, real economic clout and for a whole new image of India.

Pallavi Aiyar