Chennai, Aug 22 (KNN) Due to the rising cost of production and difficulty in procuring raw material, the forging industry in Tamil Nadu is facing a tough time despite the growing demand.

The forging industry of the state was already battered due to the pandemic. The recent rise in the price of fuel and raw materials like steel and aluminium is severely hampering the business.

The mild steel prices have jumped from Rs 40/kg to about Rs 65/kg in a year, while stainless steel prices rose from Rs 250 to Rs 350 and aluminium from Rs 250 to Rs 300-350.The cost of production fuel has also risen. For instance, the price of furnace oil rose from Rs 40/kg to about Rs 68/kg in a year.

“We are forced to buy through third-party traders, and even then, we don’t get materials on time. Industries cannot completely pass on the price rise, so industrial units have to absorb some of it and cut down expenses.” said Rajavelu Manickavasagam, managing director of Innoforge.

“The heat-based industry is also facing a labour shortage and is mainly dependent on migrant labourers,” said T Navaneetha Krishnan, director of Creative Forgings.

Krishnan further said that the industry has faced lots of ups and downs since 2020, and now, demand is picking up but we can’t deliver due to the availability and price of raw materials. Also, our margins fell by 30 per cent.”

According to the Industry experts, the recent developments in geopolitics have made western countries buy Indian raw materials, making it difficult for small-volume players to stay in the business. The forging industries work predominantly for automakers and power and heavy engineering companies.  (KNN Bureau)