Steel price hike hurt farm equipment makers, SMEs: Rajkumar Arumugam, AMMA

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Mumbai: A surge in metal costs since June has hurt agricultural downstream industries, like farm equipment makers and wired fencing contractors, and has even resulted within the closure of many small and medium industries.

“Prices across farm equipment like power tiller, power weeder and rotavator have gone up by at least 30-45%. Due to the government’s subsidy on the equipment, we cannot raise the prices for some farmers,” stated Rajkumar Arumugam, vice-chairman of the Agriculture Machinery Manufacturers Association (AMMA).

Prices of those merchandise might be elevated solely by 11-12% within the open market, and that is unsustainable for a number of small and medium producers, Arumugam stated. At least 12% of such firms have shut store, he added.

Power weeders are used for eradicating weeds and stirring and pulverising the soil, whereas energy tillers and rotavators are used for breaking or tilling the soil for harvesting.

An influence tiller which was priced round Rs 1.85 lakh in January 2020 now prices Rs 2 lakh, as per AMMA. The price of energy weeders has gone up from round Rs 80,000 to Rs 95,000, whereas that of rotavators has elevated from Rs 80,000 to Rs 95,000-1,00,000.

He stated the producers had approached the federal government over this difficulty, however the scenario had not modified but.

Retailers and distributors should not stocking up on metal because of the surge in costs, thus there’s a scarcity in provide too. Eventually, the demand for farm equipment too dropped, resulting in heavy losses, stated a farm equipment maker from Tamil Nadu.

Indian metal mills have elevated costs by virtually 50% and the hot-rolled coil costs are quoting Rs 50,000-52,000 a tonne now, in contrast with Rs 36,000-38,000 in February final yr, on the again of elevated iron ore costs and a world rally in metal costs.

Steel person industries have written to the federal government in search of intervention on the price hikes. Union minister Nitin Gadkari had additionally flagged the metal price rise and wrote to the Prime Minister in search of his intervention.

The finance minister, through the union price range presentation, had proposed to scale back the import obligation on metal to 7.5% from 12.5% and exempted metal scrap from import obligation for a brief time period.

Steel is a crucial commodity for manufacturing farm equipment equivalent to storage services, tractors, cotton picks and hay balers, feeling pails, milk machines and plenty of different merchandise.

Smaller equipment utilized in farms can also be dealing with subdued demand, with farmers both selecting to not procure or discovering options.

“Demand for wired steel fence used to surge during this time of the year, we even had better monsoons yet we could not reap the benefits as farmers are picking and choosing small areas or opting for bamboo fences,” stated a Delhi-based fence producer.

Prices of manufacturers like Tata have greater than doubled and are getting tough to be offered, stated a fencing wire contractor from Chennai.

“The import duty for steel must be brought down to zero so we can have many options to get steel from other countries rather than relying only on the domestic steel players,” stated the fencing contractor from Chennai.





This feed is routinely printed through economictimes.indiatimes.com