- The Economic Times
Commodity rally squeezing MSMEs: Managing price volatility through hedging
MSMEs are more vulnerable to raw material price volatility due to their lower capacity to absorb losses, smaller negotiating power, and lack of awareness about mechanisms to manage this unpredictability. Fortunately, accessible means exist that cushion profits.
In my earlier article, we had seen how 2016 was marked by unprecedented prices rises of industrial inputs, fed by a combination of geopolitical and demand-supply factors.
The price discovery for most key industry inputs takes place globally and Indian businesses have to become price takers per force.