Leading stainless player Jindal Stainless Ltd on Friday (March 13) said the West Asia war has affected its operations, with disruptions in fuel availability and global shipping routes impacting production and supply chains.
The company said stainless steel manufacturing depends heavily on industrial gases such as propane/LPG and natural gas, and several processes across its plants have been adversely affected.
“Unlike the conventional steel industry, which largely utilises blast furnace and coke oven gases as energy sources, the stainless steel industry follows the scrap-based production route where such gases are not generated internally. Given the constraints in fuel availability, our plants are operating at a rationalised capacity, it said.
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The company also pointed to disruptions in global shipping routes as vessels are being diverted, leading to longer transit times and cargo delays. “Additionally, disruptions in global shipping routes are resulting in vessel diversions, longer transit times, and cargo delays, which are also placing additional pressure on supply chains and margins,” the company stated.
Jindal Stainless said the government is aware of the situation and is prioritising fuel allocation for critical sectors. “We appreciate that the Government is fully seized of the matter and is actively prioritising fuel allocation for critical sectors,” it noted.
The company added that clarity on the allocation percentage for industrial propane/LPG and natural gas, along with assurance of regular supplies, will be important for the stainless steel industry to plan and optimise operations.
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“Clarity on the allocation percentage for industrial propane/LPG and natural gas, along with assurance of regular supplies, will be important for the stainless steel industry to plan and optimise operations,” the company said.
The absence of clarity could lead to wider industry impact depending on how quickly the issues are resolved, it added. “In the absence of such clarity, we foresee a cascading effect across the industry, the severity of which will depend on how quickly these issues are resolved,” it said.
Shares of Jindal Stainless Ltd ended at ₹708.15, down by ₹38.30, or 5.13%, on the BSE today, March 13.
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