CRISIS IN FOUNDRY INDUSTRY
Indian Foundry Industry ~ the 4
th largest producer of castings in the World - is facing an unprecedented crisis. This can force this mother industry to severely curtail its production or even shut down many units which may plunge the user industries like automobile, auto-component, tractor, engineering, machine tools, textiles and agriculture into deep crisis.
PRESENT SCENARIO
- Raw Material prices have gone through the roof over the last six months. Worse, the prices have increased at frequent intervals, sometimes within a week.
- Extent of price increase between August 2007 and March 2008 is as follows.
- Mild Steel Scrap - 47%
- Pig Iron - 46%
- Cast Iron Scrap - 47%
- Coke - 42%
- Ferro Manganese - 83%
- Other Ferro Alloys - 30%
- Foundries are unable to recover the frequent price increases from major customers and are pushed to a corner.
- Export prices are contracted for long periods and such frequent price increases are forcing the exporting foundry units to absorb heavy losses. This is further complicated by the appreciating rupee.
The foundry industry can survive only if it gets adequate compensation for the unprecedented increase in input cost.
OUR APPEAL TO GOVERNMENT
- Export of Iron Ore and Pig Iron to be controlled with appropriate duty structure
- Import duty on Pig Iron and Metallurgical Coke to be brought to nil
- DEPB benefit for casting exporters to be increased in tune with the present increase in the cost of input materials.
Urgent action is required NOW to save this MOTHER INDUSTRY.
THE INSTITUTE OF INDIAN FOUNDRYMEN,
IIF Center, 335 Rajdanga Main Road, Kolkata 700107