Although some people cite the stock market as the cause of the sharp rise in the price of steel products by giving the wrong address, but the mass producers, like the chairman of the economic commission of the parliament, blame the steel factories for this increase.
While the Ministry of Roads and Urban Development is trying to warm up the residential construction market by increasing the housing facilities of Mehr to complete the remaining units as well as the implementation of the national housing plan, in the last 6 months the price of rebar, which is one of the most consumed inputs It is a building, from less than 4 thousand tomans per kilogram to a little more than 11 thousand tomans;
It even reached 14,000 Tomans per kilogram at one point, but it has returned to 11,000 to 12,000 Tomans per kilogram in different parts of the country, depending on the cost of transporting this product.
This increase in the price of steel and rebar comes at a time when, despite the government’s efforts, there is still no news of the opening of units of the National Housing Plan, and an important part of the opening of these units may be transferred to the 13th government.
On the other hand, the rebar market has no underground market and no margins, and whatever it is, it is offered on the commodity exchange, the price of which is also based on supply and demand; In other words, while the philosophy of discovering commodity prices on the stock exchange should be based on supply and demand and increasing transparency,
But because of what mass-producers say, rebar hoarding by manufacturers and the supply of drippers on the commodity exchange, the price of this domestically produced product has risen sharply.
*** Result of the plan of the Ministry of Silence and Parliament: 8 thousand and 500 Tomans per kilogram of rebar
Last week, when the parliament was on a week-long holiday, several meetings took place between Ali Nikzad, the deputy speaker of the parliament, who previously held the post of Minister of Housing and is now concerned about the construction market, and Hossein Modarres Khiabani, acting Minister of Industry, Mines and Trade was held.
The result of these meetings was the withdrawal of the rebar supply from the commodity exchange and the determination of its price instead of discovering its price of 8,500 tomans per kilogram; However, this instruction has not yet been communicated by the Ministry of Silence to the Commodity Exchange and steel companies; But whispers of steelmakers’ opposition to the ordered price of rebar can be heard.
Of course, this issue was met with a reaction from the chairman of the parliament’s economic commission. In a letter to the President, Mohammad Reza Poorabrahimi, in response to whispers about the withdrawal of steel from the Commodity Exchange, stressed the need to meet the country’s steel needs with a full supply on the Commodity Exchange.
He pointed out that the current problem of the steel market is not due to the supply in the commodity exchange, but due to the lack of transparency of steel mills in selling their products. It reaches 18 million tons, there is no concern about meeting domestic demand, and with proper and coherent planning, steel exports can be put on the agenda while meeting domestic needs. “Of the 18 million tonnes of products consumed domestically, less than 35% are traded on commodity exchanges and the rest are sold by companies without transparency, which has posed a serious challenge to the steel market.”
*** Secretary of Mass Builders Association: The impact of 50 million Tomans of rebar on increasing housing prices
Farshid Pourhajat, secretary of the National Association of Mass Manufacturers, in an interview with Mehr reporter, confirmed Poorabrahimi’s remarks about the cause of market turmoil and said about the increase in rebar prices in recent months: In February last year, rebar and steel prices were 4,200 tomans per kilogram in the market. It remained stable until early May of this year.
*** The story of the sudden rise in rebar prices
He continued: “Discovery of the prices of steel products, rebars and beams is done in the commodity exchange, but in the last three months, due to the refusal of steel mills and rolling mills to supply steel products in the commodity exchange, we saw an increase in rebar prices in mid-June.” The price of rebar per kilo reached more than 12,000 Tomans per month, but in recent days, due to well-thought-out measures, it has now been reduced to 1,000 Tomans and is offered at a little over 11,000 Tomans.
The mass activist added: “In the last quarter, we have witnessed a 100% increase and in the last 6 months, a 200% increase in the price of rebar and steel, because large and parent companies in the field of steel and rebar have hoarded this product and put it on the commodity exchange.” They were offered in drops.
He reminded: this increase in rebar price is while on the one hand the World Steel Association has announced a 10% increase in production of this product in Iran and on the other hand, steel exports have decreased by 46% according to the Ministry of Silence. The third side of the triangle is the decline in housing production and the issuance of building permits, which shows that despite the increase in rebar production, its price has been increasing instead of decreasing.
*** Reducing the supply of steel ingots to rolling mills
The mass-producer emphasized: In the negotiations that the Mass-Manufacturers Association had with the rolling production companies, we came to the conclusion that the parent companies in the steel sector have reduced the supply of steel ingots to the rolling-mills, which has reduced rebar production.
Pourhajat stated: The Ministry of Roads and Urban Development and the Deputy Minister of Housing, the building of this ministry and the Civil and Economic Commissions of the parliament seek to control housing prices and do this by using empty observatories, while monitoring and controlling steel and rebar production in factories. Steelmaking is much easier.
According to this union activist, in the last quarter, we have increased the price of rebar by 500,000 Tomans per square meter of residential unit construction; In other words, the price of 100-meter residential units has increased by 50 million tomans simply because of the rebar.
*** new plan housing of the parliament is the same law as 12 years ago for organizing and producing housing
Referring to the new plan of the Civil Commission of the Majlis to approve the law on facilitating the construction and supply of housing, he said: Instead of repeating duplicate laws, we should facilitate the housing environment for builders. Instead of intervening in the production sector, the government should also facilitate the private sector.
*** Mass manufacturers offer to reduce the price of rebar
Regarding the proposal of the Mass Builders Association to control the price of rebar, Pourhajat said: “In the 70’s, the price of rebar and beams increased, at which time it was decided to give steel quotas to manufacturers for each building permit, which was a successful experience.” We suggest that this happen again and that for each building permit, steel and rebar quotas be allocated to the mass builder.
*** Steelers measure the cost price in dollars, but their subsidies and costs are in Rials.
He specified: Steel factories say that the cost price of each kilogram of rebar is 9,500 Tomans, while in the recent meeting of the Deputy Speaker and the head of the Ministry of Industry, Mines and Trade, it was decided to sell the rebar at a price of 8,500 Tomans per kilogram. In my opinion, the mistake that has been made in this matter is that steelmakers calculate the cost price with global factors and the price of the dollar, while they pay workers’ wages in rials and benefit from subsidized fuel, gas and water consumption; Therefore, they announce that the cost price of each kilogram of rebar is 9,500 Tomans.
mehr
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