LUDHIANA: In the last one year, steel manufacturers have suffered a big blow due to uncontrollable rise in the rates of steel.
According to them, there has been 20 to 100% increase in the rates of different types of steel products since July 2020, despite a huge fall in the demand for steel.
Maninder Pal Guliani, president of Ludhiana Beopar Mandal, said, “Because of the huge increase in the rate of steel raw material of different types, not only manufacturers of engineering goods but also small-time steel traders have been destroyed.
The situation is such that the minimum hike is of 20% while there are certain items that have witnessed increase of even 100%.
This month, the rate of HR coil is between Rs 70,000 and Rs 72,000 per tonne, which last year in July was about Rs 36,000.
Similarly, the rate of wire rod is currently Rs 55,000 per tonne, which was Rs 39,000 in July 2020.
Rate of TMT bars has shot up from Rs 42,000 per tonne to Rs 56,000 and that of round bars has shot up to Rs 47,000 from Rs 38,000 per tonne.” Guliani added, “Centre is responsible for this turmoil due to which the industry has suffered its biggest blow.
We have written several times to Prime Minister Narendra Modi and several Union ministers to take stock of the situation, but all in vain.
It seems that the government itself is hand in glove with big private players, who have raised steel prices by more than 100% within a year and what is even more shocking is that even government steel producers are following the same path.
It was only minister Nitin Gadkari raised the issue of higher steel prices, but the other government functionaries are mum.” According to Narinder Bhamra, president of Fasteners Manufacturers Association of India, “The central government, which is often propagating that it is the most industry-friendly government, has miserably failed on ground to take stock of the problems of the small industry.
If this was not the case then the issue of incessant hike in the steel prices would have been resolved by now, as in the last 12 months we have been constantly pleading before the Centre to take notice of it.” Stating that due to lockdowns, the demand of steel raw material has fallen considerably, Bhamra said considering that, the manifold price hike does not make any sense.
Jagbir Singh Sokhi, president of Sewing Machine Development Club, said, “Due to the unjustified hike in the rates of steel, the cost of production of all engineering products, be it sewing machine parts, bicycle parts, auto parts or hand tools, has shot up by a huge percentage.
But unfortunately manufacturers have not been able to hike the rate of the finished products due to sluggish demand and therefore we have been forced to absorb the increase ourselves.
As a result of this, every single MSME unit is suffering huge losses and several units have closed down their operations temporarily.
If the government fails to take steps to counter the situation, it is certain that a large number of factories will close down permanently.”