Construction Sector Under Pressure as Steel Prices Skyrocket

The domestic prices of steel rebars have crossed the Rs. 222,000 per ton mark due to a sudden surge in the cost of the raw material in the international market. According to Topline Securities, domestic steel producers announced an increase in the prices of steel rebars by Rs. 7,000 per ton in both the north and south regions on Monday. Effective from 13 June, the new prices in both regions are Rs. 226,000 per ton and Rs. 229,000 per ton respectively. The new prices will most likely be very unfavorable for Pakistan’s steel and construction sectors as another increase in the prices of rebars will suppress the demand for the product. It is pertinent to mention that the prices of scrap had more than doubled in 2021 and had resulted in a huge increase in investments as some of the smaller players were forced to go out of business. The current market situation is quite worrisome for the local steel industry where the cost of inputs is already increasing rapidly, and it leaves producers with no choice but to pass the impact on to the end-user.