November 21, 2008

PSM rebar sales dipping after recent price surge

The Dawn reported that the sales of rebars in Pakistan is falling after recent surge of prices to record PKR 65,000 per tonne levels.

Mr Shamoon Baqar Ali president of Karachi Iron & Steel Merchants Association said that the sale of steel bars had been falling after a persistent increase in its prices.

He said “The builders and even consumers, who plan to start construction activities, think twice either to buy steel items right now or to wait for a price decline. But the builders who have to meet deadlines for project completion are bound to purchase the item at higher prices.”

Mr Babar Mirza Chughtai chairman of Association of Builders & Developers said that builders who were already under pressure to provide the completed units at old rates are now facing problems, with the rising prices cement and steel products.

Mr Babar said that the Pakistan Steel has been frequently increasing rates of raw material and finished products, thus encouraging the vested interest in the market to play havoc with prices. He added that "The relevant government departments are not doing their job to check prices of Pakistan Steel products. The state owned unit should break the monopoly of private sector market players but it seems that it had joined hands with them in pushing up rates."

He further added that the construction industry is heading for a serious crisis when builders and consumers will be seen fighting each other on rising prices of their projects. Builders do not have an option of increasing the project cost, like other private sector contractors.’