The price of mild steel reinforcing bars (MS rod) has gone up by Tk7,000 per metric ton in two weeks, as raw materials scrap and billet have become dearer in both local and international markets.
Booking price of imported melting scrap is currently worth about $600 per metric ton, which was $490-$500 even a few months ago, and $300-$350 per metric ton in October last year.
Moreover, the price of iron extracted from shipbreaking has also surged, further raising the price of steel, industry insiders said.
About 70% of the raw material has to be imported, and due to the rise of the price of the raw materials in the international market, the price of steel has increased by about Tk20,000-25,000 per metric ton since last year, they added.
Wholesalers say that at present, 75-grade rods are being sold at Tk74,000-Tk78,000 per metric ton, which was sold at Tk67,000-Tk73,000 two weeks ago.
According to market insiders, the price of steel has shot up by 38% in the country in the last one year and they are worried that the production cost of public infrastructure projects and private residential buildings may push prices even higher.
Steel entrepreneurs said that the price of scrap metals has increased significantly in the international market due to limited supply stemming from a decline in production in Japan and Europe amid the pandemic.
But at the same time, the demand for scrap, and later steel, went up as most economies have returned to normal following mass vaccination campaigns.
Lion Sharif Ali Khan, vice-president of Real Estate and Housing Association of Bangladesh (REHAB), told Dhaka Tribune last month that the repeated rise in steel prices is having an impact on the construction of apartment buildings.
“All the steel and re-rolling mills in the country have increased the prices together and we and our customers are suffering. Steel prices are rising every month, so we do not understand exactly how much price we should fix per square foot of area,” he had said.
“We cannot even cover our production costs because we cannot take money again from our customers. Moreover, the new customers have to pay more than the previous ones for the same flat,” he added.