Visakhapatnam: Local steel traders have expressed strong reservations about a recent agreement between RINL (Rashtriya Ispat Nigam Limited) and Raipur-based vendor Mahindra Strips Ltd.
They allege that the deal, involving the exchange of coking coal for steel products and subsequent sale of TMT rebars to Mahindra Strips at a discounted price, may disadvantage local businesses and potentially harm RINL's market position.
According to reports, Mahindra Strips supplied coking coal worth Rs 70 crore to RINL in exchange for billets and semi-steel products valued at Rs 35 crore.
The remaining balance was settled through an internal order authorizing the sale of TMT rebars to the vendor. This decision has raised concerns among local traders, who have historically been RINL's primary customers and who claim to account for 40-50,000 tons of monthly purchases.
Traders allege that the discounted sale of TMT rebars to Mahindra Strips could disrupt market prices and negatively impact RINL's brand image, particularly the "Vizag TMT" brand. Additionally, they express concern that the deal may further strain RINL's already fragile cash flow.
In response to these concerns, a group of traders met with RINL officials, offering Rs 100 crore in immediate financial support on the condition that the deal with Mahindra Strips is terminated. They have also informed trade unions about the situation, who have called for an emergency meeting on Saturday to discuss the issue further.
"We demand a transparent investigation into all such deals," stated Varasala Srinivasa Rao, general secretary of JMS Union, a prominent trade union. "We will also consider stopping the movement of products if they are sold unethically to outside customers, bypassing local registered traders in Visakhapatnam."
