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Rod prices in Bangladesh hit Tk 80,700 per tonne because of the persistent high prices of raw materials globally, supply constraints, and the latest hike in fuel prices locally, official figures showed on Friday.
It was up 4.12 per cent from Tk 77,500 per tonne on Thursday, according to the state-run Trading Corporation of Bangladesh (TCB).
However, Mir Nasir Hossain, managing director of Mir Akhter Hossain Ltd, a contractor, said the actual price of rod was Tk 83,000 per tonne yesterday.
The price of the 60-grade rod went up by 7.06 per cent in the last month and 32.67 per cent in the last one year, TCB data showed.
Manufacturers largely blame the increasing cost of melting scrap in the international market for the price hike in the local market.
The price of steel scrap rose to $630 per tonne recently, said Tapan Sengupta, deputy managing director of BSRM, the largest steelmaker in Bangladesh.
Melting scrap, the raw material of steel products, was selling at $300 to $350 per tonne last October. It, however, surged since then, prompting several countries, including India, to cut the tariffs on raw material imports.
Besides, the recent increase in the fuel price has affected the steel price as the transport cost has gone up, said Sengupta.
On November 4, the government raised the prices of diesel and kerosene by Tk 15, or 23 per cent, to Tk 80 per litre.
Sengupta, however, claimed that the retail price of steel was still below the production cost as per the present input costs and feared the price would increase further in the coming days.
Hossain, a former president of the Federation of Bangladesh Chambers of Commerce and Industry, echoed Sengupta, saying the price would shoot up to Tk 100,000 per tonne due to the impact of the fuel price increase and the upward trend of raw material prices in the international market.
“The cost of construction has gone up by 20 per cent in the last one year due to the increasing steel and other raw material prices.”
Abdul Mannan, a retailer in the Bongshal area of the capital, says they were told by millers that the price went up because of global raw material shortages and the appreciation of US dollars against taka.
“The price had been going up gradually in the last six months. But, it has increased by Tk 8,000 to Tk 9,000 per tonne in the last 15 days.”
The exchange rate of the USD rose to Tk 85.79 on November 11 from Tk 84 a year ago, fueled by rising imports and a slowdown in remittance flow.
Shafiqul Haque Talukdar, president of the Bangladesh Association of Construction Industry, said: “Our projects are facing problems due to the rising cost of raw materials.”
He urged the government to move to keep the price stable.
Kamal Mahmud, a vice-president of the Real Estate & Housing Association of Bangladesh, and managing director of Skiros Builders, said the cost of construction had already increased, but the realtors could not adjust their prices since they signed agreements with the clients before the price hike.
“So, the realtors will incur losses,” he said, adding that steel millers had increased the price of MS rod illogically.
(TDS)
