High Commodity and Coal Prices Push Rajkot’s Engg Sector to the Brink | Rajkot News


Rajkot: Slowing down in the face of the global coal crisis, the largest industrial cluster in Rajkot, the engineering sector, reflects on a long holiday on Diwali to overcome the crisis that began with the rise in commodity prices raw. City’s casting and forging units supply various engineering products to several industries across the country, have already reduced production by 30%.
Incidentally, even after the pandemic-induced lockdown brought the industry to its knees, it bounced back and prepared to move forward when the coal crisis struck as another blow to the industry, in particular, the foundry of cast iron products that rely heavily on coal or electricity for fuel. Almost 50 percent of Rajkot’s smelters still depend on coal.
Foundry manufactures cast iron products that require a temperature of 1440 degrees to melt iron ore to make products used in building materials, submersible pumps, auto parts and a number of other machinery. The foundry industry itself also uses coal as fuel. The cost of fuel is about 40 percent of the total cost of raw materials.
A Rajkot engineering meeting was held last week where it was decided to increase prices as well as restrict credit to 30 days from 45 to 60 days previously.
After the meeting, the association sent a circular to its members stating: “The increase in costs will not save the foundry and other industries, but these industries are certainly on the verge of closing and this will affect production costs. . In particular, it will increase unemployment due to the shutdown of industries. ”
According to industry sources, the prices of raw materials like pig iron, coal, silicon, magnesium, graphite and scrap have increased by 80% since July 2020.
The majority of foundry and foundry workers are migrant workers.
Paresh Vasani, President of Rajkot Engineering Association (REA) said, “In casting and forging, there is a sharp increase in forging casting raw materials. The price of coal has reached Rs 54.50 per kg from Rs 26. The cost of production has increased so that we have to suffer a loss even if we are going to fulfill existing orders. It is an extraordinary situation where we are making losses just by continuing production. ”
Parth Ganatra, Vice President of Rajkot Chamber of Commerce and Industry, said: “Many units are giving three days off per week and many other units are reflecting 20-30 days vacation in Diwali. The rise in coal prices over the past three or four months is a death blow to the industry and it is high time units considered turning to solar power.
Industrialist Brijesh Dudhagara said, “We don’t have orders right now because buyers can’t afford to pay more. It’s Diwali time and we don’t want to spoil the festival for our employees. But if the situation continues, many units will not open after the Diwali holiday.


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