Sesa Sterlite's copper smelter to be shut for 22 days

India's No.1 refined copper producer Sesa Sterlite Ltd will shut its smelter for 22 days starting April 26, two company sources said on Tuesday, in what would be the first maintenance closure in four years and cut supplies to top buyer China.

Sesa Sterlite, a unit of billionaire Anil Agarwal-controlled Vedanta Resources Plc, produces 30,000 tonnes of refined copper per month and exports half of that to China.

"We were to close the plant last year for maintenance but could not because of the forced shutdown on environmental grounds," one of the sources said, referring to a closure of more than two months from March 30 on complaints of emissions.

The shutdown next month could help support global copper prices, which fell to three-and-a-half-year lows last week on fears that a domestic bond default in top consumer China could cause copper financing deals to unravel.

It will help rival producer Hindalco Industries raise sales. The shutdown was confirmed by a second source. Both sources declined to be named because they are not authorised to talk to media.

The closure might also lead to metal from China coming to India, with a group of large Chinese copper smelters planning to jointly boost shipments in the coming months to cope with low prices at home.

P Ramnath, head of Sesa Sterlite's copper business, declined to comment on the planned shutdown but said falling prices were not an issue for the company as its sales were hedged.

He added that the slowdown in China has not had any impact on exports so far.

"We're able to export the full quantity, that's not an issue," Ramnath told Reuters by phone from Tamil Nadu, where the plant is based.

"Nobody has approached us to cancel any contract or anything."

Sesa Sterlite's smelter closure last year had created a shortage for Indian cable makers such as Finolex Cables Ltd and Precision Wires India Ltd and raised imports. An environmental court later allowed the plant to be restarted.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.
Image CAPTCHA
Copy the characters (respecting upper/lower case) from the image.

EDITORIAL OF THE DAY

  • The govt needs to spend its cash without being frugal or wasteful

    Increased government spending can provide a temporary stimulus to demand and output. This is Economics 101.

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

Sarthak Raychaudhuri

vice-president, HR, Asia South Whirlpool of India

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

TODAY'S COLUMNS

Roopen Roy

Livability as a competitive advantage

Some CEOs and policymakers argue forcefully that distance is of ...

Rajgopal Nidamboor

The submarine element of your mind

We are all aware of the power of our will ...

Gautam Gupta

Retailers have it tough, thanks to e-commerce

For the past few months our focus has been on ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture