About 14 induction furnace-based steel plants at the Jindal industrial park in Raigarh’s Punjipathra are in shutdown mode due to power cut by Jindal Power Ltd (JPL) till further notification.
There are about 40 IFs in the industrial park that produce approximately 4,000 t ingot/billet per day and cater primarily to buyers in North India.
“Jindal power has withdrawn supply from yesterday for non-payment of subsidy amount. There is no clarity when it will be resumed,” said an induction furnace producer in Raigarh.
Meanwhile, market participants reported that the power cost comes to around INR 5.24/unit. In addition, producers want only the subsidy that the Chhattisgarh government provided in FY’21 to consumers, which was around INR 1.40/unit.
Officials from Jindal Power confirmed that for the time being power supply has been halted for the 14 plants due to payment issues, while some five to 10 plants having already had shut down of their own accord. Meanwhile, supply of 60-70 MW power continues to the active plants.
Jindal Power Ltd, the first domestic private sector player to commission an independent power plant (IPP) in 2007, has a total installed capacity of 3,400 MW, set up at coal pitheads.
This includes 1,000 MW plant (250 MWx4) located at Raigarh district and another 2,400 MW (600 MWx4) capacity, located at Tamnar.
With the halt in furnace operations in central India, slight supply crunch arose for steel ingot/billet in the spot market and prices rebounded by INR 300-500/t after continuous fall for a few days.
The current prices of mild steel (MS) ingot in Raigarh are assessed at INR 42,300/t and billet at INR 42,700/t.
However, sponge iron prices dropped by INR 800/t in the last two days owing to limited buying and are currently hovering at INR 30,300/t for C-DRI and INR 29,300/t for P-DRI, exw-Raigarh.
What May Happen
Sources close to the matter expect that the power supply issue would get resolved soon, with internal discussions going on. With adjustments in the due amount, industries are expected to kick-start operations, SteelMint notes.
Leave a Reply