What is your prognosis of nonferrous industry in India?

The Indian Non Ferrous metals industry can be divided into two sectors, the Primary Producers and Secondary (Downstream products) Producers.

The Primary producers are organized and large scale, and manufacture raw material such as Billets, Cathods, Ingots, Cast Rods, which are used by the secondary producers. The downstream producers which manufacture semis and finished products like wire, tube, flat, sections, rods etc, are very fragmented and sheets, rods, plates, sections, pipes, bras are managed/manufactured in the unorganized sector.

Kindly share your views about the technology adopted by the Indian companies in the sector.

The primary producers are equipped with latest technology and are also able to extract gold, platinum and palladium by Refining. Whereas only a few secondary producers are well equipped technology-wise. The capital investment in the plants to manufacture downstream products is not justified because of the high cost of investments (high interest), infrastructure bottlenecks, and high cost of energy. All this does not justify high investment in downstream plants, because the return on investment is not viable, not lucrative enough. Hence there are very few, Organized plants in the downstream products in India as compared to the other parts of the world.

What, according to you, are the major challenges faced by the domestic companies in this sector?

As stated earlier that the old technology and high cost of investment are two major challenges faced by the Indian downstream producers. The value addition in the products is hardly 10%, whereas 90% of the cost is for Raw material. It is very difficult to manage the high cost of energy (electricity), High Interest cost in balance 10%. Moreover, inefficient infrastructure and high Government control/intervention at all stages, adds to the problems.

Further, Indian manufacturers of nonferrous metals are facing challenges because the raw material attracts up to 5% duty, whereas the import of semi-finished and finished goods from some south Asian countries attracts NIL DUTY. Hence it has become all the more unviable to run the downstream manufacturing plants and compete.

Your comments on the price trends in the nonferrous metal segment…

The price of the Non ferrous metals not only depends on the demand and supply of the Metals but also on Speculation, which is part of business, but there are means to mitigate the risks and do genuine business.

There have been heavy fluctuations in the past 3 years, but for some time now the prices are more or less stable. The Indian market also depends on the international market.

Kindly tell us about BME.

Bombay Metal Exchange is the Oldest and biggest Non Ferrous metal association, for more than 57 years, serving tirelessly for the cause of Trade and Industry.

BME takes care of all kinds of problems of the trade and industry with the Govt., semi Govt. bodies, as well as amongst various members, as and when required.

BME started the concept of publishing standard BASE PRICE of COPPER and ZINC, which has now become the benchmark and accepted by all small and big producers/users of the non ferrous metal industry.

BME provides trade information such as daily, monthly local and international prices.

BME also renders medical and educational help to the needy at a very low cost, to the society without differentiating on the basis of caste, creed and religion.

BME also helps as and when national calamities occur and keep family relation with the MATHADI BANDHUS (LABOURS).

What is your view about e-commerce in the country, and its applicability to the nonferrous sector?

Ecommerce is the FUTURE for all the things, whether it is actual trade ONLINE or MANUALLY ASSISTED TRADE. Ecommerce and internet, makes it easier and faster to get information on any particular query.

As far as the downstream products are concerned, I feel, it will be a little difficult to standardize and put various products for online sale, because of the vast variety in alloys, shapes, sizes, products, thicknesses, applicability of the products.

B2B could definitely be the Future for standard items like Primary products, where either the product is standard or the supplier is BRANDED and reputed.