KARACHI: The current economic crisis, coupled with restrictions on import of steel raw material, has pushed steel rebar prices to significantly higher levels, creating friction between builders and producers of the metal. Expressing concern over the fate of construction industry, the Association of Builders and Developers of Pakistan (ABAD) in a statement lamented that a surge in steel bar prices forced the construction sector to shut their business. “We will continue protesting against cartelisation and suspend the purchase of steel at arbitrary prices,” the statement quoted ABAD Senior Vice Chairman Khawar Munir as saying.
He urged association members to continue to stay away from steel purchase until the manufacturers brought prices back to normal levels. Earlier on February 9, ABAD chairman had announced a boycott of steel manufacturers.
Steel prices have gone up over different reasons, which are both internal and external.
“Steel rebar prices soared due to supply shocks, led by import restrictions,” Optimus Research steel analyst Mehroz Khan remarked, according to The Tribune Express.
Manufacturers raised prices also because of scarcity of locally produced scrap.
“The only solution to this situation is easing restrictions on scrap import,” he suggested. “The prevailing demand and supply gap will continue to widen if appropriate measures are not taken.”
With the announcement of mini-budget, steel manufacturers hiked prices to Rs350,000 per ton while the price of a sack of cement exceeded Rs1,000, adding to the miseries of construction industry, which was already suffering due to cost overruns, said Munir. “As a result, the cost of construction projects has increased manifold.”
