With elections in the state, these units feel that they are being orphaned, and further delay in relief will worsen their situation.
Micro, small and medium enterprises (MSMEs) across Tamil Nadu, which spend huge sums of money on raw material purchases after the lockdown is lifted, face a new challenge: rising polymer prices and huge material shortages.
With elections taking place in Tamil Nadu, these units feel that they are being orphaned, and any further delay in relief will worsen them.
R. of plastic components manufacturer at Thirumudivakkam Industrial Estate. Selvam states that there is a acute shortage of polymers, particularly engineering polymers such as nylon, polybutylene terephthalate, polyserial and polycarbonate that are used in the automotive industry.
“The raw materials that I have mentioned are all imported from different countries. We have been facing shortages for the last 5-6 months due to differences in demand and supply and logistics issues, ”he says.
Mr. Selvam says Indian companies manufacturing commodity polymers such as polypoline and polypropylene have kept their prices up for a very large reason. He suggests that the government regulates prices until demand and supply return to normal. The government can reduce import duties and restrict the export of locally made polymers.
This raw material in particular is a major component for industries such as automotive, aerospace, electrical and electronics, and home appliances.
AN Rajasekar of Oragadam Industrial Estate says the high cost is affecting the working capital of the units. Renee Jose, the managing partner of Core Plasto Enterprises, does not wish to influence buyers to purchase notes that operate from Guindy Industrial Estate.
SIPCOT Pilipakkam Industrial Estate Manufacturers Association Secretary K. Jagadeesan says his business requires more than 300 tonnes of polymer a month. “We are making dashboard parts for an automobile major. High prices, coupled with shortages, have affected our export market, ”he says. He wants the government to form a Price Regulatory Council to control abnormal price increases and to help units meet their needs from alternative sources.
S. of Thirumudivakkam Industrial Estate, supplier of polymers. Senthil Kumar says that the situation worsened in the last one month, leading to a cold in Texas, USA, where many companies have stopped production. The market is good, but MSMEs will have to cut production to seek raw materials.
According to data provided by MSMEs, the price of ABS polymer is down 100% to a 260 kg compared to down 130 before the lockdown begins. The prices of other variants have increased by 40% -75% per kg.