MSMEs seek measures to control prices of copper and aluminium

The Micro, Small and Medium-scale Enterprises (MSMEs) in the manufacturing sector are currently under stress due to persistent shortage and escalating prices of critical non-ferrous raw materials, particularly aluminium and copper, said the Coimbatore District Small Industries Association (CODISSIA) in a press release.

The units engaged in pumps, motors, electrical equipment, compressors and automobile component manufacturing are heavily dependent on aluminium and copper. While the prices of these materials are linked to international commodity markets, there seems to be domestic cartelisation and price escalation, resulting in almost 20 % jump in the domestic prices. The prices continue to spiral even when the demand is less, indicating cartelisation by traders, claimed the CODISSIA president M. Karthikeyan.

Given that MSME industries operate on a 5- 8% margin, such a price escalation is unbearable for them, he said.

When there was “unprecedented increase in the basic raw material costs” in 2021, CODISSIA and other MSME associations across the country made representations to the Central government and the timely intervention of the government helped control the raw material prices.

The MSMEs continue to face challenges due to reduced imports, geopolitical uncertainties, supply-chain disruptions, high energy costs, and so on.

The government should encourage export of value-added products instead of raw materials and control the rising aluminium and copper prices, he said in a press release.