City Inc sounds alert as steel prices feel the war strain

Ludhiana: Rising steel prices have emerged as a major concern for exporters and micro, small and medium enterprises (MSME) manufacturers, with industry leaders saying sustained increases in raw material costs were squeezing margins and threatening competitiveness.The Federation of Industrial & Commercial Organization (FICO) has stated that abnormal fluctuations were hurting downstream industries, particularly micro, small and medium enterprises. Gurmeet Singh Kular, FICO president, said the abnormal hike in steel and other raw material prices had pushed downstream manufacturers, especially the MSMEs, on the verge of closure. He pointed out that the manufacturers were unable to pass on the increased cost of inputs because buyers were not willing to provide corresponding price hikes for finished goods. Kular said the situation was similar to the stress witnessed during the pandemic period, and suggested that an emergency funds scheme for the MSME manufacturers should be introduced to prevent widespread closures. He emphasized that without timely intervention, smaller units might be forced to cut production, delay exports, or even shut operations.President of the Federation of Indian Export Organisations (FIEO) SC Ralhan said steel prices had increased by around Rs 3,000 per tonne in the past one year alone, adding to cost pressures already faced by exporters amid fluctuating global demand. Manjinder Singh Sachdeva, FICO general secretary, said steel prices had increased by a minimum of Rs 10/kg, significantly impacting manufacturing costs across sectors such as auto components, machinery, fabrication and engineering goods. He also highlighted that prices of non-ferrous metals, including nickel, titanium, chromium, aluminium, copper and zinc, remain volatile and largely uncontrolled.Sachdeva called for the creation of a regulatory mechanism to monitor commodity price movements and ensure rational pricing in the country. He said stable and predictable input costs were essential to support MSME manufacturers and boost India's export competitiveness. The manufacturers and exporters in the engineering and metal-based sectors are finding it difficult to remain competitive in international markets as buyers are reluctant to accept higher prices, another industrialist said.
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