Copper Price Surge Slams Coimbatore's Engineering Industries
Copper prices have skyrocketed in Coimbatore, India's primary MSME cluster, by almost 75% over the past year. One kilogram of copper now costs ₹1,450, up from ₹800-₹900 a year ago. This sharp increase has eroded the competitiveness of engineering industries in the region, which produce automobile components, electric vehicles, pumps, renewable energy components, and electronic parts.
According to V. Rangaswamy, president of the Coimbatore District Small Industries Association, MSMEs can absorb price hikes up to 10%, but with over 60% increase, they are only able to pass on 10-15% of the rise in copper prices to their customers.
Additionally, prices of steel and zinc have also gone up, further affecting the competitiveness of MSMEs. Rangaswamy noted that schemes such as raw material banks are not helpful in these situations, as copper is a precious metal that cannot be stored in bulk.