Neelachal Ispat may Shut Down Coke Oven Plant on Financial Crisis - Sources

Neelachal Ispat Nigam Ltd (NINL), a public sector steel entity and largest merchant supplier of steel-grade pig iron in India likely to shut down its 700,000 MTPA Coke oven plant on financial crisis, SteelMint learned from market participants.

Sources told SteelMint that NINL is struggling to "buy coking coal on its own to feed the plant" after Metals and Minerals Trading Corp. of India (MMTC) stopped supplying the raw material.

Sources mentioned that company has stocks which can only survive for one week.

Under an arrangement, MMTC buys raw material from the open market to feed the NINL plant at Kalinganagar, Odisha, and sells the finished products manufactured at the plant. For all buying and sales transactions, MMTC is entitled to a 3 percent commission.

Early this month, NINL had shut down its 1.1 MnT blast furnace on similar reasons.

MMTC and the Odisha government had announced plans to sell stake in what it calls a "loss-making" plant. MMTC is the largest stakeholder in NINL with an equity of 49.9 percent. The Odisha government owns 26 percent stake.