The local prices of steel products have dipped below the Rs. 230,000 per ton mark because of a sudden drop in the cost of raw materials in the global market.
According to the sources, domestic steel producers Amreli Steels Limited (ASTL) and Ittehad Steel announced a huge decline in the prices of steel rebars by around Rs. 8,000 per ton on Oct 10, as per the JS Research. The new prices now stand in the range of Rs. 221,000-225,000 per ton effective from 10 October 2022,
Sources reported that a similar announcement is also expected by other manufacturers as well.
The sharp decrease in steel prices is likely because of the cost of scrap coming down along with the retardation in domestic demand as the country reels from the flood aftershocks. Further research says that the rupee appreciation observed during the past 10 days also facilitated todays sharp reduction in domestic steel prices.
Moreover, the steel prices went up in April and June, however, in August these went down during the current year. It began increasing from Rs. 227,000 per ton in April and climbed to Rs. 250,000 per ton in August 2022. From then onwards, it started falling again and now crashing to around Rs. 221,000 per ton.
Further details show that in August the prices of Cold Rolled Coil (CRC) and Hot Dipped Galvanised Coil (HDGC) dropped by Rs12,000 per ton, which lead to prices being lower than PKR 250,000 per ton. The new prices for 1 mm CRC and HDGC are recorded to be PKR 230,550 and PKR 237,900 per ton, respectively. In addition, the decline in prices was due to the low domestic demand, decreased cost of scrap, and rupee appreciation.
Earlier, the construction industry had to face a hard time pricing the housing units due to the growing prices of steel products, which considerably raised the project completion costs.