KARACHI: Amreli Steels Limited, one of Pakistan’s largest steel manufacturers, has announced an extension of its Karachi plant closure due to persistent market pressures and weak construction demand. The company stated that operations will remain halted until conditions stabilize and the demand for steel products improves.
According to a notice submitted to the Pakistan Stock Exchange (PSX), Amreli Steels cited sluggish construction activity, high energy costs, and limited liquidity in the domestic market as the main reasons behind the continued shutdown. The company emphasized that the decision was taken to optimize expenses and protect long-term financial sustainability.
Impact on Steel Sector and Construction Industry
The prolonged closure of Amreli Steels’ Karachi plant has sparked concerns within the construction and manufacturing sectors. Analysts note that reduced production could lead to supply disruptions, affecting steel prices across the country. However, industry experts also believe that low construction activity might balance the impact in the short term.
Contractors and builders, already struggling with project delays due to inflation and high borrowing costs, fear that continued production halts may further challenge their operations. Despite these setbacks, Amreli Steels reassured stakeholders that its distribution and sales network would continue functioning through existing inventories.
Company’s Strategy for Recovery
Amreli Steels management is reportedly exploring new strategies to improve operational efficiency once the market stabilizes. The company aims to modernize production facilities and reduce energy dependency through renewable alternatives. Additionally, management plans to reassess its pricing model to stay competitive once operations resume.
Market observers expect that if construction activity increases in 2026 with infrastructure revival and housing projects, Amreli Steels may restart its Karachi plant earlier than anticipated. Until then, the firm will focus on maintaining liquidity and ensuring steady cash flow from other business operations.
Outlook for Pakistan’s Steel Industry
The steel sector in Pakistan continues to face headwinds, including currency volatility, costly imports, and inconsistent policy measures. Experts stress that stable economic reforms and government-backed development projects are essential to revive steel demand.
Amreli Steels’ decision to extend its Karachi plant closure highlights broader challenges across the industry but also signals cautious optimism for recovery when market conditions improve.
