Surge in Rebar Prices: A Challenge for Egypt’s Construction Industry
The construction industry in Egypt is facing an uphill battle, with a sharp rise in the cost of rebar, a vital construction material. This increase in rebar prices, driven by factors such as the surge in global iron ore prices and the escalating exchange rate of the US dollar against the Egyptian pound, is pushing up real estate and construction costs. This price hike is a significant concern for the Egyptian public.
The Government’s Response
On the governmental front, measures are being considered to lessen the impact of this price surge. Steps could include subsidizing the cost of rebar or advocating for its rational use. These actions reflect the government’s commitment to ensuring that the construction industry remains sustainable despite the challenges.
Ezz Steel and the Rebar Market
Industry giant Ezz Steel announced the price of a ton of rebar on December 24, 2023. Despite recording a net loss of EGP509m in the third quarter of 2023 due to foreign exchange losses, the company saw an increase in long steel production by approximately 20% year-on-year and a surge in flat steel production by around 48% year-on-year. However, domestic rebar consumption fell by approximately 30% year-on-year in the first nine months of 2023, indicative of the inflationary pressures in the market.
The Arab Iron and Steel Union
The Arab Iron and Steel Union, established in Algeria in 1972, is dedicated to the development and growth of the iron and steel industry in the Arab world. The Union has been monitoring the situation closely, given the impact of these price fluctuations on the industry. Egypt’s imports of raw materials of iron, steel, iron ore, and their concentrates declined by 25.5% to $4.163 billion in January-September 2023 as compared to the same period in 2022.
In conclusion, the current rise in rebar prices is a significant challenge for the Egyptian construction industry. The government and industry players are exploring various strategies to mitigate its impact and ensure the continued growth and development of the sector.
Credit: Source link