Pakistan Steel Mills Corporation (PSMC) has started import of raw material against the government guaranteed loan worth Rs 6 billion to improve the production capacity and reduce losses. Sources said so far PSMC has finalised two deals for the import of coal and iron ore fine to meet its demand, as due to unavailability of raw material, the production of state run steel producer has fell to less than 25 percent.
Out of these two deals, one ship carrying 55,000 tons of coal has already reached Port Qasim, which unloading was delay because of payment issue, however now unloading has been completed and Pakistan Steel is consuming imported coal to enhance its production. With the arrival of coal ship, PSMC will be able to reduce its production losses, which were increasing gradually due to delay in import of raw material, they added.
Another ship carrying over 50,000 tons of iron ore fine, a basic raw material for steel production, will reach Karachi next month. At the same time, PSMC management is struggling to procure iron ore lump from local sources and now are negotiating with some mine owners in Balochistan. Sources said the current import of raw material is being made under the new business plan worth Rs 6 billion for PSMC approved by the ministry of production. Some two more Letter of Credit for the import of iron ore are likely to open soon, as already imported raw material is insufficient to fulfil Pakistan Steel's demand. They said the delay in the import of raw material has already reduced the production capacity of mills upto 25 percent, besides billions of rupees losses in terms of production.
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