AMNS India Faces Potential Output Cuts Amid Raw Material Import Restrictions

Indian government restrictions on the imports of key raw materials will force ArcelorMittal Nippon Steel Limited (AMNS) India to cut steel production and defer expansion plans by a long margin. According to sources from the Ministry of Commerce, the company has expressed concerns about these limitations, especially on low-ash metallurgical coke, an important ingredient in steelmaking.

In recent months, the Indian government has imposed country-specific quantitative restrictions on the import of low-ash metallurgical coke, which is a key ingredient used in producing steel via blast furnaces. AMNS local suppliers cannot meet the necessary coke quality standards required for its operations. The company warned that if the situation continues, it may have to idle one of its blast furnaces by June 2025 or cut back production as soon as April 2025.

The uncertainty around supplies of raw materials has put a cloud over AMNS’s lofty expansion plans. The firm is investing aggressively to ramp up its production capacity, with a $9 billion investment plan that was launched in 2021. AMNS aims to increase its steel production capacity fourfold to 40 million metric tons per year by 2030. The company had planned to commission a new blast furnace by December 2025 as part of this expansion.

AMNS is also a leading voice in India’s steel sector with a large steel plant in Gujarat. If the potential output cut and expansion delays become real, there could be repercussions for the wider steel market and for the downstream industries that rely on its products.

The situation underscores the challenges confronting steelmakers in India as they navigate shifting regulatory environments and deal with supply chain bottlenecks. Whether the government will solve these issues or whether AMNS will take the initiative will not only set the stage for production disruption but also AMNS’s long-term growth numbers.