Steep hike in steel prices hits engineering industry

Source: THE TRIBUNE

The constant hike in steel prices in the past 2-3 months is giving sleepless nights to engineering goods manufacturers and exporters. The industry fears that the 30-35% increase in prices during the period will make them non-competitive in the international market and it would be difficult for them to meet export obligations.

The price of steel ingot (raw material) has increased from Rs 28,000 per tonne in November 2017 to about Rs 37,000 per tonne today.

“With such a big rise in steel and other inputs prices, it is very difficult to sustain in the present scenario. The government should act immediately to rescue the engineering industry which contributes a major share in the country’s GDP,” said Shailesh Aggarwal, president, Baddi Barotiwala Nalagarh Industries Association.

According to industrialists, small exporters who have committed orders in hand are the worst hit as they are unable to execute the orders due to high input costs.

“Small exporters from hand tools and hardware industry are among the worst hit as they have become non-competent in the international market. The government should take steps to control such unjustified hike in steel prices,” said Sandeep Verma, chairman, Exports and International Business, Baddi Barotiwala Nalagarh Industries Association.

Sandeep said besides the steep hike in steel prices, delay in GST refund has also hit them hard. The exporters’ precious working capital is blocked due to the delay in GST refunds.

Upkar Singh Ahuja, president, Chamber of Industrial and Commercial Undertakings (CICU), said MSMEs are suffering due to non-availability and high prices of steel.

He said even public sector undertaking Steel Authority of India Limited (SAIL) was not supporting the MSMEs in such difficult times.

The CICU has also sent a representation to Union Steel Minister Chaudhary Birender Singh and Steel Secretary Dr Aruna Sharma, mentioning that SAIL officials were helping only special customers and ignoring the MSMEs for their personal benefits.

The manufacturers have demanded immediate rollback of price hike in the steel prices and said it would have a huge impact on viability of projects. They said Indian steel makers had started exporting to China, thus creating scarcity in the local market leading to high prices.

Source: THE TRIBUNE