Prices of MS rod increase Tk7, 000 a tonne in a week

Prices of MS (mild steel) rod, a vital construction material, have increased by Tk6, 000 to Tk7, 000 per tonne in the local market in the last one week due to soaring prices of raw materials in the international market.
Some industry people, however, blamed local businessmen for this price hike, as it takes at least two months for the international price change to have any affect on the local market.
According to market sources, per tonne 60-grade MS rod is selling between Tk69, 000 and Tk70, 000 in Dhaka's retail market, while 40-grade MS rod is selling between Tk65, 000 and Tk66, 000.
“It is true the prices of melted scrap and ship scrap, raw materials for MS rod, have gone up in the international market, but the price hike in the international market should take effect locally only after two months,” a steel mill owner said.
Presently, import prices of per tonne of melted scrap ranges between US$550 and 600, which was around $350 two months back, and prices of ship scrap is between $750 and $800, which was around $550, said Masudul Haque Masud, general secretary of Bangladesh Re-Rolling Mills Association.
“We have increased the prices of 60-grade rod by Tk2, 500 as costs of raw materials import have increased,” said Aameir Alihussain, director of Bangladesh Steel Re-Rolling Mills.
He, however, did not cite any reason for the price hike of 60-grade rod by Tk6, 000 to TK7, 000.
The price rise also creates concern among the construction industry people. “Both small and big construction companies are in trouble with the unreasonable price spiral of rod,” said Mukarram Hussain Khan, president of Real Estate and Housing Association of Bangladesh (REHAB).
“We have already requested the finance adviser to withdraw all kinds of import duty on raw materials for MS rod,” he said.
Presently, the import duty on raw materials for rod is 10 percent.
The prices of rod have been rising for the last few years. In March 2006 the prices of 60-grade rod was between Tk40, 000 and Tk41, 000 a tonne and 40-grade rod between Tk38, 000 and Tk39, 000 a tonne.
Our Chittagong correspondent adds: The prices of rods continue to increase, making the retail markets unstable.
The prices of 60-grade rod increased by Tk 2, 000 to 2, 500 per tonne and 40-grade rod by Tk500 to Tk1, 000.
Sources in rod manufacturing firms said, they were selling 60-grade rod with 8mm radius at Tk68, 500 per tonne on Wednesday against Tk66, 000 of the previous day. The same grade rod with 10mm to 25mm radius also increased by Tk3, 000 per tonne, selling at Tk68, 000 against Tk65, 000 of the previous day, they said.
The 60-grade rods were selling between Tk57, 000 and Tk5, 8000 per tonne before the rise in the last ten days.
The 40-grade rod produced in automatic mills rose by Tk500 to Tk1, 000 per tonne and was selling between Tk64, 000 and Tk64, 500 on Wednesday. The same grade rod, made of scrap iron, was selling at Tk63, 000 per tonne against its previous price of Tk62, 500.
The construction firms and contractors expressed deep concern over the price hike, and many of them are now thinking of disapproving the work orders even at the expense of their security deposited.
A construction contractor with a government work-order for a culvert construction in hand said, the construction work may cause a minimum loss of Tk35 lakh due to the price hike of MS rod.