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High rod price hits construction sector badly

Published : 07 Feb 2022 10:20 PM | Updated : 08 Feb 2022 02:10 PM

Since the middle of January, the price of one of the main construction materials, rods, has gone up from Tk 2,000 to Tk 3,000 per tonne.

At present the price of each ton of rod is from Tk 75000 to Tk 79500 while it will cost Tk 80,000 to Tk 81,500 to buy a better quality rod. But even at the beginning of January a ton of rod was sold at Tk 72000 to Tk 78000. 

In the span of three months, it increased from Tk 10000 to Tk 11000 per ton. Last September, the market price of good quality rod was Tk 79000 to Tk 80000 per ton.  

With such an upward trend hitting the country’s housing sector badly, industry insiders said they are struggling to survive in their business.  

Real Estate and Housing Association of Bangladesh (REHAB) vice president Lion Sharif Ali Khan while talking to Bangladesh Post said, “Because of the sudden price hike of rods, our construction cost is going higher. New construction in the housing sector is also stalled. From October to February, is the peak season for the housing sector.”   

According to the Trading Corporation of Bangladesh (TCB), 60 grade rods are now being sold at 15.5 percent higher prices than last year’s. And the price of 40 grade rods has increased by 16 percent compared to last year.

According to the Bangladesh Steel Manufacturers Association (BSMA), the price of rod produced in the country has logically increased due to increase in the price of raw material in the world market. At present, 79 percent extra money has to be spent to buy scrap. Overall production cost has increased by 52 percent. In contrast, the selling price has increased by only 37 percent. 

BSMA and the Bangladesh Association of Construction Industries (BACI) recently met at the FBCCI office to discuss rod prices. As per them, rod price has logically increased against the high price of its construction materials in the world market. 

FBCCI president Md. Jashim Uddin presided over the meeting. He assured all present to solve the problems of the construction sector through mutual cooperation and dialogue. 

It was decided at the meeting that the entrepreneurs of the two sectors would sit in discussion every three months. 

However, Steel producers said that if construction companies were allowed to import rods, the local industry would suffer and a large number of people would lose their jobs. In such a situation, BSMA demanded reduction of all existing tariffs on import of scrap and sponge iron for domestic producers.

The rod is now being sold at Tk 78,000 to Tk 80000 per ton in the country. On the other hand, in West Bengal, India, the selling price per metric ton of rod is equivalent to Tk 86,000.

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