PSU major Rashtriya Ispat Nigam Limited (RINL) seems to be sustaining its inventory depletion trend for the second month in a row. Closing stock of inventories in end-Jan’22 are expected to be at 0.27million tonnes (mnt), down almost 74,000 t against Dec’21’s closing stock of around 0.34 mn t. It may be recalled Jan’22 inventory were lesser by 80,000 t compared to Dec’21.
Most mills are seeing a comfortable position with regard to long products inventory, in which RINL is a key player, because of higher demand overseas and domestically.
Production impacted
However, crude steel production at RINL is expected to take a hit of around 0.1 mnt in February, SteelMint learnt from reliable sources.
Production at one of its three blast furnaces will be disrupted for about a fortnight due delayed supplies of coking coal. It buys substantial amount of this fuel from the spot market despite having long-term contracts. Spot market supply is scarce due to production disruptions at Australia brought on by bad weather.
“Whichever mill buys coking coal from the spot market will be impacted by rising prices and supply disruptions,” observed a market source.
As a result, the market will probably see another hike in long products, this time, of around INR 1,000/t, propelled by RINL’s production loss which will create some supply tightness.
The steel major does not usually go for maintenance in Q4 but this year is an exception, impelled by the coking coal supply tightness.
RINL’s total monthly production is at around 0.5 mnt.
Sales
Meanwhile, in January, RINL expects sales to increase by 40% to 0.53 mnt against 0.38 mnt in the previous month.
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