KARACHI: Steel bar prices once again moved up by Rs3,000 to a record Rs146,500 per tonne ahead of the federal budget FY22.

In the last week of May, some steel bar manufacturers stopped taking new booking orders from June 1, 2021 from builders in a bid to increase bar prices. In mid-May, the manufacturers had raised steel bar prices by Rs5,000 per tonne to Rs142,500-143,500, citing an unexpected surge in international scrap prices.

Contrary to this, the average per tonne import price of iron and steel scrap has plunged to $379 per tonne in 10 months of the ongoing fiscal year (10MFY21) from $389 per tonne in the same period in FY20. Total iron and steel scrap imports in 10MFY21 stood higher at 4.154 million tonnes, valuing $1.55 billion as compared to 3.319m tonnes costing $1.293bn in the same period in FY20.

Chairman Association of Builders and Developers of Pakistan (ABAD) Fayyaz Ilyas vehemently rejected the price hike in steel bars ahead of the budget. He urged the federal government to take stern action against the steel manufacturers’ cartel to save the construction industry and Naya Pakistan Housing Scheme.

He demanded the government to stabilise steel prices through abrogation of Re­­gulatory Duty (RD) and Additional Regulatory Duty (ARD) on steel import so that the construction industry can flourish and the PM’s vision of constructing five million houses for the masses could be realised and national economy could be strengthened.

According to the Pakistan Economic Survey 2020-21, iron and steel production inched up by 1.66 per cent during July-March FY2021 as compared to 7.96pc dip in the same period last year. Billets/ingots production, mainly used in construction industry, grew by 37.2pc as compared to 14.6pc decline last year.

The government had announced a special package for the construction sector which includes an amnesty scheme, tax exemptions and Rs36bn subsidy for 10 years for the construction under the Naya Pakistan Housing Scheme. After witnessing enormous effects on construction and its 40 allied industries, the government has further extended tax amnesty and fixed tax regime till June 2021 and December 2021, respectively, the survey added.

The SBP has assigned mandatory targets to banks requiring them to increase their housing and construction of building loan portfolios to at least 5pc of their private sector advances by the end of December 2021.

Published in Dawn, June 11th, 2021