With Every High, There is a low. Could this be a glimmering low for Steel bars in Pakistan?
Things cannot just stay constant in one line they either go up or down, that’s quite the same story for Pakistan’s steel prices which had risen during the start of the lockdown. It was in demand and now when the situation of Covid19 pandemic in Pakistan has somewhat gone a bit better the steel prices have dropped low. This has somehow made an absolute recovery in the construction industry.
Although the pandemic brought a humungous loss to humanity as well as economically and financially to a lot of the renowned businesses all over the world.
The import and exports cargoes were at an abrupt halt due to the lockdown for months and months. Nonetheless due to the discovery of the vaccines, encouraging the government to restore humanity and as well as restoring the peace economically whilst taking baby steps. The accumulation of the demand in steel led to an inflation in its worth making local rebar prices to rise from Rs117,000 per ton in November 2020 to Rs 140,000 per ton at the end of January 2021.
The dramatic rise of steel has made international prices soaring higher and higher over the few months due to the shortage in supplies all over the world. Ameer Hamza an equity analyst from Taurus Securities added furthermore that steel marketeers increased their rebar prices owing to the escalation of prices internationally. The prices fluttering near Rs 142,500 per ton for a couple of weeks back but now the prices seem to be lowering.
Pakistan’s large steel producers [PALSP] Secretary general Syed Wajid Bukhari said; With the steel prices now falling to 130,500 per ton people had expected it to eventually be normal.Further adding that; Monetary value of rebars had increased significantly in Pakistan after the cost of scrap rose from $350 per ton in October of 2020 to over $500 in early of 2021, Also brushing upon that in a lot of countries the scrap prices inflated during the cold weather as well as the disorderly supplies related to Covid ultimately ensued a low scrap in numbers.
The rebar steel prices may diminish in the coming months ahead while the domestic industry prepares for immense changes currently whilst in the pandemic. The ongoing decline of the monetary value of steel could be a silver lining for the construction industry.
Prior to that the domestic steel industry had to deal with severe crisis over the last two to three years although they had declared to have lost a large sum yet that did not affect the prices of rebars.
The devaluation of Rupee against the dollar, and an immense escalation in the interest rate by the State Bank of Pakistan as well as the tax regime in 2019 increased even more burden on the sales tax.
In the last three months the value of steel bars used for reinforcement of concrete construction soared higher by a 20 to 25%.
Nevertheless the inflation of prices were also witnessed in other construction items such as bricks, tiles, cement, pipe and fittings etc.