Amreli Steels to halt production at Karachi facility, 30% production affected

MG News | September 24, 2024 at 10:21 AM GMT+05:00

0:00

September 24, 2024 (MLN): The Board of Directors (BoD) of Amreli Steels Limited (PSX: ASTL) has decided to temporarily suspend operations at its oldest manufacturing facility, the SITE Rolling Mill (SRM) in Karachi, which accounts for 30% of the company's total production capacity.

The decision is attributed to the significant economic challenges facing the documented steel sector, as stated by management.

These challenges have been exacerbated by various economic and political factors, including declining demand for steel rebars, rising utility costs (particularly electricity), high interest rates, an unbalanced tariff structure, heavy tax burdens, smuggling, and increased undocumented activities.

Together, these issues contribute to unfair competition and severely disrupt market equilibrium.

The company further said the situation will be reviewed in six months, and the facility may reopen if conditions improve.

During this period, the company will continue operating its Dhabeji facility, which accounts for 70% of its production capacity, to meet current and future steel demand.

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