Mohammad Badrul Ahsan :
The prices of mild steel rod (MS rod), a key construction material, declined significantly in the last couple of months mainly because of lower demand from the public and private sectors, industry-insiders said
They said the recent price slump also happened in line with the global price trend.
Market-insiders said local mills are trying to prevent import, which caused the decline.
MS rod (60 Grade) eased, now selling at Tk 42,000-Tk 43,000 per tonne from Tk 50,000-Tk 52,000 two month back.
Rods of 40-grade prices declined to Tk 39,000- Tk 40,000 from Tk 45,500 to Tk 46,000 earlier, the traders said.
Abdus Samad Munshi, a trader of the city’s English Road area told The New Nation that prices of rods have started declining since the national budget for FY’17 was placed before parliament.
He said the traders were concerned that prices might rise as they came to know import duty on billet was hiked in the budget.
“But we found opposite attitudes of the mills,” he said.
He said rods’ prices witnessed Tk 2,000-8,000 decline at per tonne in a month.
He said the demand for construction materials at the village level has plunged in the last one year.
However, the government imposed 20 percent regulatory duty and 15 percent VAT on billet (secondary raw material of rods) import in the new budget.
According to the Bangladesh Auto Re-Rolling and Steel Mills Association (BARSMA), import cost of billet rose to nearly Tk 12,000 per tonne from Tk 7,500.
SK Masudul Alam Masud, chairman of the BARSMA, told The New Nation that the demand for MS rods has declined in both the government and private sectors.
He said that though some big projects of the government are going on, small-scale public work across the country has declined.
He said 30 big and 350 medium and small-scale steel mills now produce 3.6 to 4.0 million tonnes of MS rods annually, of which the government purchase accounts for 70 percent.
When asked, he said the country’s most of the steel mills now import melting scarps and are producing billet locally.
Import duty on scarp has not increased, which has been helping make the product more competitive, he said.
Kazi Anwar Ahmed, head of corporate affairs at the BSRM Group also said the demand for construction materials in real-estate sector has slowed in recent years.
The import duty on billet should be reduced to make the sector more competitive, he said.
Another steel mill owner, requesting anonymity, said that Indian steel mills are trying to take hold of Bangladeshi market.
He said the doors of the Indian ‘seven sister states’ to Bangladeshi steel millers almost shut after India gained the transshipment and transit facilities for carrying goods at only $2.42 per tonne.
He expressed his concern under the facility, Indian rods could enter the country in near future.
The local steel mills are trying to protect the local market from intrusion of imported rods, he said.
Executive director of Bangladesh Steel Mills Owners Association (BSMOA) Md Homayon Kabir said the sectoral growth of steel industry was 10 per cent year-on-year basis from 1990 to 2008.
After that, the sector never grew more than 5.0 per cent, he said.
According to BARSMAS, BSMOA, Bangladesh Re-rolling Mills’ Association and Bangladesh Ship Breakers Association, the sector’s annual turnover is now Tk 200 billion and it employs 1.2 million people.
The prices of mild steel rod (MS rod), a key construction material, declined significantly in the last couple of months mainly because of lower demand from the public and private sectors, industry-insiders said
They said the recent price slump also happened in line with the global price trend.
Market-insiders said local mills are trying to prevent import, which caused the decline.
MS rod (60 Grade) eased, now selling at Tk 42,000-Tk 43,000 per tonne from Tk 50,000-Tk 52,000 two month back.
Rods of 40-grade prices declined to Tk 39,000- Tk 40,000 from Tk 45,500 to Tk 46,000 earlier, the traders said.
Abdus Samad Munshi, a trader of the city’s English Road area told The New Nation that prices of rods have started declining since the national budget for FY’17 was placed before parliament.
He said the traders were concerned that prices might rise as they came to know import duty on billet was hiked in the budget.
“But we found opposite attitudes of the mills,” he said.
He said rods’ prices witnessed Tk 2,000-8,000 decline at per tonne in a month.
He said the demand for construction materials at the village level has plunged in the last one year.
However, the government imposed 20 percent regulatory duty and 15 percent VAT on billet (secondary raw material of rods) import in the new budget.
According to the Bangladesh Auto Re-Rolling and Steel Mills Association (BARSMA), import cost of billet rose to nearly Tk 12,000 per tonne from Tk 7,500.
SK Masudul Alam Masud, chairman of the BARSMA, told The New Nation that the demand for MS rods has declined in both the government and private sectors.
He said that though some big projects of the government are going on, small-scale public work across the country has declined.
He said 30 big and 350 medium and small-scale steel mills now produce 3.6 to 4.0 million tonnes of MS rods annually, of which the government purchase accounts for 70 percent.
When asked, he said the country’s most of the steel mills now import melting scarps and are producing billet locally.
Import duty on scarp has not increased, which has been helping make the product more competitive, he said.
Kazi Anwar Ahmed, head of corporate affairs at the BSRM Group also said the demand for construction materials in real-estate sector has slowed in recent years.
The import duty on billet should be reduced to make the sector more competitive, he said.
Another steel mill owner, requesting anonymity, said that Indian steel mills are trying to take hold of Bangladeshi market.
He said the doors of the Indian ‘seven sister states’ to Bangladeshi steel millers almost shut after India gained the transshipment and transit facilities for carrying goods at only $2.42 per tonne.
He expressed his concern under the facility, Indian rods could enter the country in near future.
The local steel mills are trying to protect the local market from intrusion of imported rods, he said.
Executive director of Bangladesh Steel Mills Owners Association (BSMOA) Md Homayon Kabir said the sectoral growth of steel industry was 10 per cent year-on-year basis from 1990 to 2008.
After that, the sector never grew more than 5.0 per cent, he said.
According to BARSMAS, BSMOA, Bangladesh Re-rolling Mills’ Association and Bangladesh Ship Breakers Association, the sector’s annual turnover is now Tk 200 billion and it employs 1.2 million people.
