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India’s Small Steelmakers Face Production Cuts Amid LNG Supply Disruptions

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Asia 11 Mar 2026 03:25 PM IST Economic Times

 India’s small steelmakers are coming under pressure as LNG shortages linked to the Iran war begin to disrupt fuel availability, especially in Gujarat, a key gas-consuming industrial hub. Several secondary steel producers are preparing to cut output as gas supplies tighten and uncertainty grows over near-term availability.

The supply squeeze is particularly serious for gas-based units that depend on steady LNG flows to keep operations running efficiently. Industry players have warned that production could be reduced sharply, while prolonged disruption may force some mills to halt operations altogether. At the same time, higher coal and freight costs are adding to the pressure on already thin margins in the secondary steel sector.

The development highlights how global geopolitical tensions are feeding into India’s industrial supply chain, raising concerns over costs, output stability and raw material planning. For the steel market, the situation could affect production schedules, pricing trends and sentiment across smaller mills if fuel stress continues.