Sterlite smelter to stay shut until April 29

India’s largest copper smelter, run by Sterlite Industries, will not start commercial production until at least April 29, when a court will again consider a request to reopen the plant, shut over emission complaints.

The month-long closure of the plant could further drive up premiums for copper in Asia, but traders and analysts said there may be enough stocks to meet demand in India for about a month.

An expert panel will inspect the plant between April 18 and 29, justice M Chockalingam of the National Green Tribunal said after a hearing in the fast-track environmental court yesterday.

“The factory will be opened for required hours of operation to assist inspection,” he said, adding that the panel would hand in its report on April 29.

Sterlite declared force majeure on copper deliveries after the March 30 closure of the plant, based in Tamil Nadu.

It produces about 350,000 tonnes of the metal a year and exports about half of that.

Most of India’s copper exports go to China, the world’s biggest consumer of the metal, which used up around 9mn tonnes last year — vastly more than India’s annual consumption of around 600,000 tonnes.

Sterlite, a unit of London-listed resources conglomerate Vedanta Resources, which is awaiting approvals to double capacity at the smelter to 800,000 tonnes per year, welcomed the formation of the panel.

“This should have been done before the Tamil Nadu Pollution Control Board took a decision to stop a running plant abruptly without proper basis,” said P Ramnath, chief executive of Sterlite’s copper business, referring to the state emissions regulator.

State authorities ordered the closure after nearby residents complained about emissions, saying they had caused burning in the throat and difficulties in breathing.

Sterlite, which has said the plant’s emissions were within agreed limits, said on April 3 it had declared force majeure on copper sales and concentrate purchases. The smelter uses imported copper concentrates as its main raw material.

Force majeure is a contract clause that allows a company to miss shipments in circumstances beyond its control. Indian end-users had stepped up enquiries for copper cathode as well as scrap following the closure, a Singapore-based trader said last week.

However, there could be enough stocks in Asian warehouses to meet immediate demand, experts said.