Micro, Small and Medium Enterprises (MSMEs) in Coimbatore are under significant cost pressure as copper prices have surged nearly 75% over the past year, rising from around ₹800–₹900 per kg to ₹1,450 per kg, after earlier touching ₹1,500.
This increase is impacting the city's engineering industries, which produce automobile components, electric-vehicle parts, pumps, renewable energy equipment, and electronic components. Since India imports nearly all its copper, the sharp price rise directly inflates production costs and reduces the competitiveness of local MSMEs. Industry representatives noted that units can absorb a price rise of less than 10%, but with copper costs up more than 60%, they have managed to pass on only 10–15% of the increase to customers.
This squeezes profit margins, as many MSMEs fix product prices only once a year or every two years. Concurrently, rising prices of steel, zinc, and petroleum-based products add to the overall cost burden. The situation has led manufacturers to explore alternatives like recycled copper and copper-coated wires. According to industry representatives, raw-material bank schemes provide limited relief because copper's high value discourages large stockpiling.
The sustained input cost increase is affecting the financial health and competitiveness of Coimbatore's MSME sector, prompting manufacturers to adapt production methods and materials.
