JSW Steel Output Slumps in April as Coronavirus Batters Economy

(Bloomberg) -- JSW Steel Ltd. posted a nearly 60% plunge in output in April as a nationwide lockdown stretched through the month, in a signal that supply may have fallen sharply in the world's second biggest producer.

The first of India's major steelmakers to report production in April, JSW's crude steel output slumped to 563,000 tons last month, it said in an exchange filing Monday. Tycoon Sajjan Jindal's flagship mill averaged capacity use of around 38% during the period, although with the government easing restrictions in many areas, JSW is gradually ramping up capacity, it said.

The steel industry globally has been hit because of restrictions in production and the movement of people as governments scramble to control the spread of the coronavirus outbreak. Demand for the alloy in India has also been slammed, with the country's top carmakers reporting that they couldn't ship a single vehicle to dealers in April as they shut production.

The Indian government extended its lockdown by another two weeks from May 4, easing some restrictions. The lockdown plus a staggered opening up of the economy in the weeks ahead, means a heavy toll on the economic output, with gross domestic product expected to contract by 24.8% year-on-year in the current quarter, according to Bloomberg Economics.

Tata Steel Ltd., Steel Authority of India Ltd., and JSW are India's biggest mills, making up for 46% of total annual output last year. While steel companies can operate under the government's rules during the lockdown, many mills have scaled down operations due to logistical hurdles and lack of manpower.