By Debarati Roy
Dec. 12 (Bloomberg) -- JSW Steel Ltd., India¡¯s third- biggest steelmaker, will put on hold the expansion of its pipe- making mill in Texas, which it acquired last year, after demand from oil companies slumped.
¡°All oil companies have put their projects on hold,¡± Sajjan Jindal, managing director at JSW Steel, said today in an interview in New Delhi. ¡°Demand has fallen sharply,¡± he said, adding that the plan may be revived when ¡°stability¡± returns.
The global recession has hurt energy and metals prices, forcing companies to scrap expansion plans. ArcelorMittal and Nippon Steel Corp., the world¡¯s two largest makers of the metal, have delayed a $240 million plan to double capacity for producing auto steel sheets at their U.S. venture.
Mumbai-based JSW had been planning to raise output of pipes at the U.S. mill to reach full capacity of 500,000 metric tons and take advantage of higher oil prices. The takeover of the plant was the company¡¯s first U.S. acquisition.
JSW shares, which have slumped almost 83 percent this year, fell as much as 11 percent, and traded at 227.25 rupees, down by 5.3 percent at 2:00 p.m. India time. Crude futures in New York have slumped 69 percent since reaching a record $148.35 a barrel in July.