RINL incurring production loss per month Rs 500cr/day amid survival battle

Visakhapatnam: Rashtriya Ispat Nigam Limited (RINL)-corporate entity of Visakhapatnam Steel Plant, notwithstanding the efforts to ensure minimal production of coke oven batteries to ensure safety and avert a catastrophe owing to possible leakage of hazardous gases/chemicals, has incurred huge losses at a time when it is battling hard for survival and achieve a turnaround.

Union leaders, who participated in the ‘Maha Garjana’ organised on Sunday under the aegis of Visakha Ukku Parirakshana Porata Samiti (VUPPS), which is fighting against privatisation of RINL since the Cabinet Committee on Economic Affairs’ decision on January 27, 2021, alleged that there is a systematic attempt to sabotage the turnaround efforts and demoralise the morale of the workforce by denying them salaries on time, to pave the way to hand over the company to private companies after the elections.

RINL production has almost come to a standstill for over past one week due to strike by the workers of Adani Gangavaram Private Port Limited (AGPPL) leading to denial of coking coal and limestone discharge from the private port to the steel plant.

RINL recorded a turnover of Rs 23,129 crore in 2023-24 by excelling in all departments with a two per cent growth over the previous year weathering adverse market conditions, and high production cost for want of captive mines - a long-pending demand.

After attempts to unload 1.5 lakh tonnes of coking coal brought in two ships from Australia and the USA failed, the management diverted the stranded vessels to neighbouring Visakhapatnam Port Authority (VPA), which is under the control of the Ministry of Ports, Shipping and Waterways. Initially, RINL management closed operations in two of the five coke oven batteries and two of the three blast furnaces. Now all five batteries are in operation to ensure safety, on the advice of experts, with bare minimum production.

Now pushings are at a minimum by restricting hot metal production to 20 per cent incurring a production loss of Rs 500 crore to Rs 600 crore a day,” Neerukonda Ramachandra Rao, president, Visakha Steel Employees’ Congress (VSEC), told Bizz Buzz.

VSP is India’s first shore-based integrated steel plant with an annual production capacity of 7.3 million tonnes. The third blast furnace, which was shut down for a long time, was revived last year following a MoU with Jindal Steel and Power Ltd (JSPL). The steel plant also entered into an agreement with Tata International Ltd for Letter of Credit (LoC) arrangement to procure raw material. It is in talks with mining major NMDC to allot surplus lands on lease for setting up apelletisation plant.

RINL management said after diverting two ships stuck at Gangavaram Port to Visakhapatnam Port, they are expecting the raw material situation to improve to some extent in a day or two. They are also in the process of procuring coking coal from SAIL from its stockpoints. Company officials said they are procuring around 40,000 tonnes of coal from other sources which will help the company in addressing the present crisis. The company is hopeful of ramping up production in a phased manner.

RINL has been constantly pursuing with AGPPL regarding transfer 82,000 tonnes of limestone and 2.2 lakh tonnes of coking coal which is already available in AGPPL Referring to reports in a section section of media regarding investigation into the usage of substandard coal by RINL, a company spokesman clarified that RINL is having a robust and transparent procurement policy and quality control systems which are “process driven” and not “person driven."

Addressing the maha garjana, CITU State general secretary Ch. Narsinga Rao, AITUC national vice-president D. Adinarayana, CITU leader J. Ayodhyaram and others said the steel plant is a pride of Andhra and all the political parties should clear their stand on the future of RINL in the upcoming elections. He reiterated the allotment of captive mines to RINL for raw material security and to explore the merger of RINL with SAIL as a long-term solution to create a giant public sector entity.