Steelmakers based in Chhattisgarh (Central India) may face shutdown of plants on the grounds of high input cost (Iron ore & coal) and lower sale price of produced material.
The falling demand and rising prices of key raw materials such as Iron ore and coal are likely to hit Chhattisgarh based steel plants. It is expected that the plants may face shutdown mainly due to slowdown in demand.
Chhattisgarh steel manufacturers believe that if NMDC, a stated-owned and India’s largest Iron ore producer, will reduced its prices by 30%, it will become feasible to run the plants.
CGSIMA’s General Secretary Vijay Jhanwar stated to media, “The present state of affairs has worsen. On one hand, the raw material prices are rising continuously, on the other, demand for finished steel is falling sharply.”
Mr. Jhanwar further added that in 10 years, Iron ore prices have increased from INR 300/MT to INR 5,000-6,000/MT.
In Chhattisgarh, there are 90 Sponge plants, which cater the needs of mini steel plants to produce Ingot. Out of 90 plants, about 20 plants are shutdown and the rest are struggling for survival. In this context, the steel sector has appealed to the state government as well as central government, but no action has been taken yet. To resolve this issue, the state government has conducted a meeting with NMDC’s Chairman and other officials in Raipur, but no conclusion has been come out.
On Thursday, representative of Chhattisgrah Sponge Iron Manufacturer’s Association (CGSIMA) members talk to Ramesh Bias, Member of Parliament, in order to resolve the current problem faced by Chhattisgarh steel plants.
– Sourced
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