Steel companies, including those under public sector, are considering to scale down production amid coronavirus outbreak, according to sources.
Sajjan Jindal's JSW Steel has already announced its decision to cut production at its plants.
The industry sources said top management of major players like Tata Steel, JSPL, ArcelorMittal Nippon Steel India (AMNS India) and state-owned SAIL and RINL are also discussing similar move.
In many states, movement of raw material needed for Steel making is being impacted due to nationwide lockdown, they added.
Employees in the industry are facing difficulties in reaching their offices.
"There is no purpose of just producing and building up inventory levels. Till when the players will produce and keep on piling the output. They can't stop the blast furnaces which are supposed to function continuously, but reduce production,"a source said.
Blast furnace is a large structure of about 30 metre high at steel plants. It is lined with refractory firebricks that can withstand temperatures to as high as 2,000 celcius.
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Once stopped, it takes several months for a steel company to re-start the critical steel making equipment.
During the lockdown, dispatch by railways and roads is also affected.
According to industry sources, local administration is not allowing trucks carrying goods to ply on road.
Steel players have already apprised the ministry about the issues being faced by them and urged to ask local administration to allow movement of important raw material and finished goods.
Those on duty at important plant locations are facing difficulties in getting their passes made by the local administration.
JSW Steel, Tata Steel, JSPL, AMNS India, SAIL and RINL together produce about 45-50 per cent of the country's total steel production annually.
At present, India's total installed crude capacity is at about 140 million tonne per annum.