New Delhi: Rising raw material costs have pushed up prices of commonly used household plastic products by as much as 35%, manufacturers say.
“The prices of household plastic items such as buckets, furniture, utensils and even soap cases have increased by 30-35% in the last six months, mainly on account of a rise in raw material prices,” Plastic Export Promotion Council chairman Nimesh Sayani said.
Raw material costs of the plastic industry has gone up by more than 40% in addition to a rise in transportation costs and wages, he said.
According to official data on inflation, the wholesale plastic product prices have gone up by more than 4% in the last one year.
Market watchers said the rates of almost all plastic items, whether for household or industry, agriculture or commercial sector, have increased in the retail market.
The increase in prices has marginally affected the demand of these products, especially in smaller towns and rural areas, they added.
The prices of plastic goods such as trays, bottles, chairs and toy cycles available at retail stores have gone up even further, the retailers said.
The plastic manufacturers have submitted a representation to the Union finance minister, P. Chidambaram, asking for the abolition of customs duty on import of petrochemical products, especially polymer.
The manufacturers complained due to a rise in cost of raw materials, the profit margins had reduced by 10-12% and some units were on the verge of being closed. The manufacturers are unable to schedule production due to frequent raw material price hikes, with 50% of production lines lying idle.
“We are unable to keep our commitment with clients because of pricing uncertainty,” Sayani said.
According to plastic exporters, many minor traders have closed down their businesses. There are about 2,200 plastic exporters in India who ship products worth about Rs13,804 crore to African and American countries.