State-owned steelmaker Rashtriya Ispat Nigam Ltd. (RINL) has been forced to shut down its blast furnace 3 at the Vishakhapatnam (Vizag) plant due to a coking coal shortage caused by a workers’ protest at the Gangavaram port. The shutdown, which occurred on 12 September, leaves RINL with only one operational blast furnace out of three at its 7.3 million tonne per year (t/yr) capacity plant, though no official announcement has been made by the company.
The shortage of coking coal has significantly impacted RINL’s production, particularly of long steel products such as rebar. However, rebar supplies from other state-owned producers, including the Steel Authority of India (Sail), have helped mitigate some of the supply disruptions.
RINL has faced ongoing challenges with coking coal supplies, with blast furnace 1 remaining shut since May due to earlier disruptions at the Gangavaram port, where around 250,000 tonnes of coal are stuck due to the protests. To address the coal shortage, RINL issued a global tender in July 2024 to import 375,000 tonnes of pulverized coal injection (PCI) coal, with some coal now starting to arrive.
The plant’s output has suffered, with finished steel production falling by nearly 11 percent year-on-year to 1 million tonnes over the April-July period, accounting for around 2 percent of India’s total finished steel production. In addition, the company is grappling with a severe cash crunch, preventing it from paying shipment charges for coal stuck at Gangavaram and Visakhapatnam ports.
To address its financial troubles, the company has submitted a detailed report to the Ministry of Steel, outlining the need for $1.19 billion to operate its three blast furnaces at full capacity and settle outstanding debts of $833 million. Although the ministry has promised a working capital infusion of $357 million to keep the company running, no funds have been released as of yet, according to sources.
