Govt Steelmaker In Trouble As Coal And Limestone Worth ₹700 Cr Stuck At Adani Port: Report

A government-owned steel manufacturer is reportedly facing massive losses amid protests by workers at an Adani Group-owned port.

What Happened: Rashtriya Ispat Nigam Ltd (RINL), also known as Vizag Steel Plant, is suffering a daily revenue loss of ₹40 crore-₹50 crore due to a workers’ protest at Adani’s Gangavaram port in Andhra Pradesh, Moneycontrol reported, citing sources.

This information was revealed in a letter from RINL’s chairman and managing director, Atul Bhatt, to the Adani Group port firm. The protest, which began on April 12 over wage disputes, has severely disrupted the supply of coking coal, an essential ingredient for steel production, causing a significant backlog.

Around ₹700 crore worth of coking coal and limestone belonging to RINL has been stuck at the port since the protest began.

RINL’s letter to Adani Gangavaram Port Ltd (AGPL) CEO Amit Malik, dated May 5, highlights the urgency of the situation, noting that the lack of coking coal not only results in substantial financial losses but also endangers the health of the equipment due to prolonged shutdowns.

See Also: Dixon Tech Shares Volatile After Q4: Brokerages Advise Caution

No Response: Despite repeated requests for the immediate transfer of coal and limestone lying at AGPL yards, RINL has not received any response from AGPL. The Andhra Pradesh High Court has mandated AGPL to transport the coal to RINL through a conveyor belt system or any other immediate mode of transport.

Bhatt’s letter to the Vizag district collector underscores the potential damage to equipment worth over ₹16,000 crore and the jeopardy faced by 30,000 employees if the situation persists. RINL currently has five coke oven batteries and three blast furnaces, but only one furnace remains operational due to the coal supply disruption.

Background Of Protests: The strike stems from a dispute between Adani Gangavaram Port management and manual workers, who are demanding higher wages and better retirement benefits. These workers, many of whom are former fishermen displaced by Adani’s acquisition of the port in 2021, were employed as manual labourers at the port. The acquisition, which saw Adani Ports and Special Economic Zone (APSEZ) acquire a 58.1% controlling stake from the DVS Raju family for ₹3,604 crore, significantly impacted the local fishing community.

Gangavaram port is strategically positioned as a gateway to India’s east coast and neighbouring countries in Southeast Asia, facilitating trade routes connecting India with key markets in the Asia-Pacific region, including China, Japan, South Korea, and ASEAN nations.

Read Next: Mankind Pharma: Strong Q4, Acquisition Reports Not Enough To Power Stock

Don't miss a beat on the share market. Get real-time updates on top stock movers and trading ideas on Benzinga India Telegram channel.

Posted In: NewsAdani GroupAdani Ports