The steel and steel products market has experienced significant inflammation in recent months, and iron ore prices have experienced strange and unexpected growth.
This growth is taking place while the consumption of steel has been in recession during this period, meaning that there is no demand for the actual consumption of this metal.
*** many steel products follows the dollar exchange rate
It is worth mentioning that the statistics of steel production and consumption in the country are known. All activists in this field also acknowledge that according to these statistics, there is no restriction on the production of steel and related products and we are not facing any combo in this field. In such a situation, the significant growth of the exchange rate should be considered as one of the reasons for the increase in the sale rate of hardware in the market, ie the price of many steel products follows the dollar exchange rate.
The difference between the distribution system and production should be considered another reason for this high cost, because the distribution system of steel production in our country does not follow the same trend. In fact, in the current market, every activity is for personal gain and the distribution system has practically disappeared.
Unfortunately, in the current situation, the views of the unions are not considered by policy makers at all. Producers set the price, and renters welcome the situation. However, if the presence of unions and trade union activists is used, their presence can be used to solve the problem of the steady growth of steel prices.
*** Steel chain policies to the detriment of the consumer
However, steel chain policies are currently being adopted without regard to union views. Such policies will often be to the detriment of the end consumer. We believe that billions of tomans of money are transferred in this area, the culprits in this chain must be identified and held accountable.
In the current situation and after the outbreak of Corona in the world, the production system all over the world is facing disruptions. In such circumstances, the country’s steelmakers are expected to focus their priority on meeting the needs of the domestic market and continue to think about exports. Unfortunately, in some cases, meeting domestic demand is not a priority for steelmakers, and sometimes some producers prefer to export to sell in the domestic market.
For this reason, we see that some steel rolling units are facing challenges in supplying the ingots they need to produce steel products. In such a situation, the wrong policies of policymakers in the ministry have added to the problems, as measures such as cancellation of transactions have further inflamed the market and the rollers have faced a shortage of raw materials to supply the raw materials they need to produce. The upward trend in prices was effective.
*** Determining the sales ceiling for hardware
Such wrong policies continue. For example, setting a sales ceiling for hardware should be considered one of those wrong strategies that is sometimes implemented by those in charge. Not only do these measures not have a positive effect and they will not have an effect on resolving the tensions in the steel market, but they can provide more grounds for corruption; That is, it provides an opportunity for some to make a profit; Therefore, if a price ceiling is to be set, activists in this field must be consulted without hesitation, and finally a decision must be made that has the least consequences.
It should be noted that the conversion of iron and steel into capital goods is another major reason for the growth of prices in this market. That is, in a situation where the country’s economy is facing instability, people are less inclined to cash and prefer to devote their capital to investment. In this situation, the demand for hardware also increases and falsely provides the basis for price growth.
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