cawky wrote:
I Dont know what is happening to the scrap metal prices , Cawky
Hi Brian
Found this piece on the Net - gives the view point from Bangladesh where as you will know many ships end their lives:
http://www.thedailystar.net/story.php?nid=61015Prices of steel, materials down
Kawsar Khan
Rods are being carried to a construction site. The price of 40-grade MS (mild steel) rod now stands at Tk 40,000 a tonne in the local market, while the cost of 60-grade steel rod is around Tk 58,000. Photo: STAR
Prices of steel and its raw materials have fallen sharply in the local market on the international market price-drop resulted from the construction work slumps globally in the wake of the ongoing recession.
The sector people think the construction market slumps coupled with the fall in demand for their produces now cost them dearly.
They also blamed the slow pace of the government's annual development programme (ADP) for the slide in local demand.
Official data shows only 9 per cent of the Tk 256 billion ADP has been implemented during July-September period of the current fiscal (2008-09).
In the local market, breakable ship was selling around US$250 a tonne and scrap around $380 a tonne yesterday, which were $600 and $700 two months back.
They are to sell the items at a rate 30-50 percent below the production and import costs, which is leading them to a vulnerable situation, according to manufacturers and importers.
They said the price of 40-grade MS (mild steel) rod stands at Tk 40,000 a tonne in the local market, while the cost of 60-grade steel rod is around Tk 58,000.
"The products that we are selling at lower rates were imported at higher prices earlier. But the price-drop in the international market has forced us to sell the products at a loss," said Alihussain Akberali, chairman and managing director of BSRM, the largest steel bar manufacturer in the country.
Asked about the reason why they were selling their produces at a rate below the cost of production, Alihussain said it was a natural market trend that they had to hike prices in advance when international prices went high and vise versa.
"We have no control over the international market, but the government can save us by accelerating its ADP implementation pace, which will result in the rise in local demand for steel bars," said Masudul Haque Masud, general secretary of Bangladesh Re-Rolling Mills Association.
Meanwhile, the ship breakers' association recently sent a letter to the Ministry of Industries where it pointed out that the ship breakers, who have a stock of around 10 lakh tones, are losing around Tk 10,000 by selling scrap at the present market price.
In a separate letter sent to the Chief Adviser, Bangladesh Steel Mill Owners Association said the sector would loss around Tk 1,000 crore by selling their 5 lakh tonnes reserved MS rod.
The steel mill owners and ship breakers urged the government to provide strong support to face the tough situation.
Regards
