India: Steel Mills in Mandi Gobindgarh Allowed to Resume Operations

On 5th May'20, the government allowed Mandi Gobindgarh, Fatehgarh based steel mills to resume operations. Mandi Gobindgarh is a town and municipal committee in Fatehgarh Sahib district in the state of Punjab in North India. Prior to this, from 1st May'20 onwards, the plants have been permitted to load & unload material, which had accumulated at their premises.

However the mills are allowed to operate only with a minimum workforce and to operate plants for 8 to 12 hours a day. While it has been notified that labour is not allowed to be outside the premises during night to morning hours.

As per SteelMint's conversation with its sources, most of the standalone Rolling Mills & Hot Rolling Mills (HRM) are likely to resume operations in a couple of days or by weekend, however standalone furnaces may take some more time for resumption, although these are very limited in number.

Mandi Gobindgarh, is a major buyer of semi finished steel (sponge iron, ingot & billet) from Central & Eastern regions of India, while being one of the biggest consumer of melting scrap that is sourced from the NCR region and also the local market.

Sources believe that the biggest challenge that Mandi based furnaces may face in coming days is sourcing scrap as the logistics like availability of labour and transportation between its location and NCR (Delhi) remains the major concern.

There are about 400 steel mills in Punjab including furnaces & rolling mills, which produces rebar, pipe, patra & other structural steel products and supply within the state as well as other parts of North India.