ArcelorMittal Nippon’s legal challenge against the Indian government arises from the rejection of met coke import orders following new restrictions. The company warns of severe impacts on production and financial losses, while rival JSW Steel has raised similar concerns. Government officials argue sufficient domestic supplies exist, amidst ongoing scrutiny over trade policies.
ArcelorMittal’s joint venture in India has initiated legal proceedings against the Indian government regarding the retrospective rejection of imports of low-ash metallurgical coke. This litigation stems from a policy change implemented in January that imposed import restrictions on this essential steelmaking raw material, causing significant concern among major steel producers, including ArcelorMittal Nippon Steel India, over the quality of domestic substitutes.
The restrictions have prompted ArcelorMittal Nippon to warn that it may need to reduce its steel production and delay expansion plans. On March 5, the company filed a legal challenge at the Delhi High Court, contesting the government’s decision to deny 168,300 million tonnes of import orders from Indonesia and Poland that were submitted prior to the effectiveness of the new restrictions.
The Indian government defended its decision by asserting that ArcelorMittal Nippon had adequate domestic supplies of met coke. However, the company argues that such a stance undermines the principles of free trade, which should allow imported orders that were placed before the imposition of new policies. The legal documents filed capture concerns over the retroactive application of regulations, emphasizing how this leads to instability and distrust among investors and traders.
Compounding the issue, rival JSW Steel has also approached the Delhi High Court, raising similar concerns about delays in the approval of their own met coke imports valued at approximately $90 million. In statements, India’s Steel Secretary noted that sufficient domestic met coke is available, while the desire to import is largely driven by cost advantages, as imported met coke averages $50-100 less per tonne.
In its court filing, ArcelorMittal Nippon expressed that the government’s actions could lead to severe financial repercussions for the company, estimating losses of $25 million per shipment and incurring ongoing vessel detention fees of $27,004 each day that permissions are delayed. A confidential communication from February 19 indicated urgent warnings about potential production cutbacks, with the company suggesting a possible halt to its blast furnace operations by June. ArcelorMittal Nippon holds a 5% share of India’s 200 million metric tons per year steelmaking market, and the nation’s imports of low-ash met coke have surged significantly over the past four years, now capped at 1.4 million metric tons for the first half of 2025.
In summary, the legal battle between ArcelorMittal Nippon and the Indian government underscores the complexities arising from recent import regulation changes impacting the steel industry. The potential financial and operational repercussions of these restrictions are significant for the company, raising broader concerns about the implications for trade policies and market confidence in India’s steel sector.
Original Source: money.usnews.com
