Post lock-down in India, Indian secondary steel mills have been facing issues, further the industry might face challenges once they reopen and resume operations, said Mr. Ramesh Agrawal, President of Chhattisgarh Sponge iron Manufacturers Association & Chairman of GR Group of Industries in a recent podcast with SteelMint.
Major issues being faced by SME’s-
According to him, despite the permission to re-open plants with several conditions by the government, the major problems these industries are facing includes labour shortage & logistics, which are big concerns and cannot be sorted easily.
Further he is of the view that, there is an adequate liquidity crunch in the market due to a slowdown in economy amid falling government’s revenue.
He also highlighted that the trade cycle will not work properly till the global market turns fully operational.
Mills holding decent inventory levels of iron ore
— In context to raw material, he reported that most of the sponge plants are packed with Iron ore as well as coal. As per him on expectations of iron ore supply disruption due to expiring major Odisha mining leases in Mar’20, the buyers preferred to secure key raw materials, so that they can continue to operate their plants.
— Further on finished steel he cited sufficient inventories with the mills as they halted supply post mid of Mar’20 owing to delayed payments followed by strict checking on border over COVID-19 fears. So, when the market will reopen, the supply is expected to remain strong, however demand is a major concern, he further added.
Any demands from the state government?
Mr. Agrawal also mentioned that, the Chhattisgarh based steel industries have demanded the state govt to waive off duties on electricity bills (minimum demand charges) and also urged to extend the due date of bill payments, however there is no any update from the authorities yet.
To listen to complete podcast, click here https://bit.ly/2JKDhFz
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