Vijayawada: Rashtriya Ispat Nigam Ltd-run Visakhapatnam Steel Plant is losing upto Rs 1,000 crore a year on account of lack of captive iron ore. This, an official claimed, has made the plant unviable.
The raw material makes up 63 per cent of RINL’s cost compared to 48 per cent 35 per cent by its rivals SAIL and Tata Steel, which have captive iron ore mines.
RINL also faces uncerta-inty over the timely availability of raw material, its quality and quantity. It buys the iron ore at market price, which is much higher than the price at which it exports the ore, making it lose upto Rs 1,000 crore on this account itself. In spite of this disadvantage, RINL had managed to stay profitable till 2016.
However, it slipped into losses due to global recession, dumping of cheap steel by China, price escalation of imported coal and a capital investment of Rs 18,000 crore.
