They stressed that it is among the challenges of the sector caused by the “Corona” pandemic.

Officials: The cost of freight and raw materials raises iron prices

• It is expected that iron prices will begin to stabilize during the coming periods, supported by the abundance of supply.

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Officials in iron production and supply companies reported that the “Corona” pandemic has significant repercussions on the iron sector, whose prices have recorded successive increases since the beginning of this year, under pressure from the increases imposed by the pandemic variables on the cost of shipping and raw materials.

And they pointed out, to "Emirates Today", on the sidelines of the "Middle East Iron and Steel Conference 2021", which finally ended its work in Dubai, that the "pandemic" was reflected in the increase in the cost of shipping and logistics services at the global level, and also caused a decline in production operations for materials Crude globally, which contributed to increases in iron prices in varying proportions, pointing out that iron prices are expected to start stabilizing during the coming periods, supported by the abundance of supply.

iron prices

In detail, the Secretary-General of the Iron Producers Committee in the Emirates, and Senior Vice President of Marketing at Emirates Steel, Muhammad Salem Al-Afari, said that "iron prices, especially rebar, have recorded varying and successive rises since the beginning of this year, at the global level, under pressure. The variables imposed by the Corona pandemic, which were reflected in the increase in the cost of logistics and shipping and the rise in the prices of raw materials, which in turn led to an increase in iron prices,” noting that “the international prices of rebar ranged during the beginning of this year between 600 and 625 dollars per ton, and after that, increases were recorded. successively until it reached a peak of $ 840 per ton (an increase of 34.4%), and finally reached the limits of approximately $ 725 per ton, and its indicators in the local markets approached about 2550 dirhams per ton (695 dollars) during the recent period.”

He added that "iron price indices are instantaneous indicators that change according to the prices of global stock exchanges," noting that "the pandemic has caused an increase in the cost of production for raw materials at global levels, and a return in demand after the peak periods of the pandemic during the first half of this year, which contributed to an increase in prices. Iron".

Al-Afari explained that “the local markets witnessed a growth in demand during the current year in varying proportions, due to the resumption and start of many projects in the markets, which in turn contributed to the increase in local production of iron, especially rebar, from about 4.4 million tons during the past year to exceed about about 4.6 million tons this year.

Rising prices

Rohit Kana, Director of Business Development at the Iron Production Company, Rohit Kana, said that “(the pandemic) imposed several challenges on the iron production sector, the most prominent of which was the increase in prices by more than 30% since the beginning of this year, due to the increases in the prices of logistics services from handling and shipping, in addition to the high prices of raw materials, with the decline in production operations in a number of global factories due to the pandemic conditions.”

He pointed out that "raw materials from countries such as China, Russia and America have witnessed increases estimated at 20% since the beginning of this year." greater proportions of raw materials.

government support

For his part, CEO of "Conares" company for the production of iron and steel, Bharat Bhatia, considered that "steel prices have recorded an increase since the end of last year, after China stopped government support provided to steel production plants in the country," noting that "iron prices have reached globally." During the last quarter of last year, it reached 400 dollars per ton, and it kept recording increases until it exceeded 600 dollars per ton during the first quarter of this year, before continuing to record varying increases.” He added, "The most prominent challenges imposed by the pandemic on the iron sector are the increase in the cost of raw materials, which is mainly determined with shipping fees, the prices of iron in the markets."The CEO of “Al Ghurair Iron and Steel” Company, Abu Bakr Hussein, indicated that “the pandemic has provided continuous effects so far on the iron sector, through successive increases since the beginning of this year until now, at global levels,” noting that “the stability in Iron prices are one of the possibilities within the next year, but returning to previous price rates may take time.”

The size of the increase in prices globally has exceeded 34% since the beginning of 2021.

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