For the micro, small and medium-scale enterprises (MSMEs) in the engineering sector, continuous hike in raw material prices is affecting business despite demand in the market.
Coimbatore District Small Industries Association president M.V. Ramesh Babu said orders were good across sectors, except pumpsets and valves. Even export orders were encouraging. However, there was no decrease in prices of raw materials. The recent steep hike was in prices of aluminium.
“We have represented through different forums. But there is no measure to bring down prices and imports are also not feasible,” he said.
Coimbatore and Tiruppur District Association of Cottage and Tiny Enterprises president C. Sivakumar said orders continued to be good even for job working units and smaller industries. However, raw material prices were high, affecting the profits and leading to uncertainties for the MSMEs.
While the prices of ferrous items remained stable for the last few weeks, availability was an issue, he said. In the case of non-ferrous items, prices were shooting up. For instance, cost of aluminium remained stable at ₹205 a kg for two months. It increased to ₹245 a kg last week and on Thursday, it was ₹260 a kg.
K.V. Karthik, president of Southern India Engineering Manufacturers Association, said there was a sharp drop in demand for not only agricultural pumps, but also domestic pumps. Raw material prices had seen almost 100 % jump in the last one year and it had hit the MSMEs badly.
The government should control the raw material prices for the growth of the industry, he said.
