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Non availability of raw meterials hit downstream Steel Industry severely

 Kolkata, 21 November (HS) : The Rs 8,000 cores Indian Steel Wire  Industry which employs over 200,000 people, is adversely affected by acute shortage of raw materials and certain trade policies, making it non-competitive in the middle of stiff competition both in the domestic and international markets.

 

Expressing serious concern at the present state of affairs in the Industry, Nirmal Saraf, Chairman, Steel Wire Manufacturers Association of India (SWMAI) who took part in a webinar to  highlight the  present condition created following the non availability of raw materials for the products, here today said Wire Rods constituted around 70 per cent of the total production cost of Steel Wires and it was absolutely necessary to have easy access of this important raw material at globally competitive prices either from the internal  sources or from imports.

 

According to Saraf, the National industrial policy stipulated that indigenous value addition should be promoted in order to conserve foreign exchange, generate additional revenue and employment, and to fully utilize capacities for economic operation of industry.

 

This also fulfils the objective of “Make in India” and Prime minister Narendra Modi's vision of “Aatmanirbhar Bharat” to make the country  self-reliant by reducing its dependence on imports, and  promoting a large manufacturing hub for domestic and export markets. he said.

 

Further elaborating the present scenario in the industry, Saraf pointed out that in the last 3 months, wire rods from large-scale steel mills had become scare.

 

 

 Facilities from SAIL plants at Burnpur and Bhilai and RINL's Vizag factory could not meet production targets for a variety of reasons. Tata Steel and JSW  were also offering limited quantities to the domestic market.

 

Electrosteel Steels was forced to shut down all operations for three weeks. In 3 months, prices across the market shot up by approximately 25 per cent. Supplies became erratic, and downstream industries found unprecedented shortage of raw materials forcing them to curtail and, in some cases, suspend operations, Saraf said adding the hardship, that was experienced by the Steel Wire Industry owing to outbreak of “COVID-19”, was compounded by this shortage of raw materials leaving them totally stranded, he said

 

Demanding an immediate intervention from the government Saraf said they  must create a suitable mechanisms to ensure sufficient availability of scarce raw materials, either from domestic sources or from imports.

 

A level-playing field must also be given to the downstream steel industry for sourcing their raw material through all avenues, including through minor import allowances for individual firms, is a potentiality worth exploring.

 

Moreover, the availability of wire rods at reasonable prices must also be ensured from the importers, Saraf pointed out. 

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