The economic meltdown sweeping the globe has precipitated into a crisis at Kalinganagar with most steel plants in the region shutting down furnaces and managements resorting to disengagement of workers.
Jindal Stainless, which had shut down all its four blast furnaces since September 17, was resorting to several cost-cutting measures to stay float.
A spokesperson of Jindal Stainless said recently that the price of the finished product had gone down due to the slowdown, adding that the management at this juncture had the only option to lay off workers as an austerity measure for the company's survival.
Public-sector Nilachal Ispat Nigam Limited (NINL) was also facing the heat due to the economic meltdown.
A company source said that the production at the plant had been curtailed and maintained to the extent needed to operate the furnace.
Although the plant had not disengaged any worker, the management would have to take appropriate action to beat the crisis. Rohit Ferrotech Ltd, a ferro chrome unit which has a production capacity of 300 mt per day, had also shut down two of its four furnaces in the last 20 days.
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The company had also disengaged about 200 contractual workers due to shutdown of the furnaces.
A source at Rohit Ferrotech said that while production cost of the finished product was Rs 61,000 per tonne, the selling price was Rs 51,000 per tonne.
In addition to fall in realisation, the company had also piled up an inventory, the source said, adding that under such circumstances, the company might retrench workers as a survival measure.
Maithan Ispat Ltd was also facing similar crisis with prices of finished products getting halved.
The company had shut down one of its two furnaces due to the slowdown.
Sources in the company said that 100 of its workers were already disengaged and more layoffs were being planned.
According to sources, while prices of ferro chrome had dipped considerably, the price of the raw material chrome ore did not fall in line considerably.
Another steel plant at Kalinganagar, Visa Steel Limited, had also shut down its ferro chrome unit due to the slump in the market.
Mesco had also shut down one of the two furnaces.