India has been witnessing a high rate of inflation and continued increase in interest rates for a long time now. One of the most recent impacts was on the auto industry, which has increased prices across the board. The forging industry has cited the continually rising industrial fuel prices and fluctuating steel prices as the key reasons for rising input prices and shrinking margins.

The hike in the prices of industrial fuel is having a cascading effect on the entire industry. In fact the price of furnace oil has skyrocketed in the last few months. The price of furnace oil has increased to Rs 35.60, a whopping increase of 52% over the last 6 months. The price of furnace oil was Rs 23.48 as on 01.09.2010.