Rising steel prices are putting pressure on sectors like
automotive and
construction. However, steel producers and market analysts express that the price increases are the result of unfair Chinese competition.
In
India,
construction sector witnessed a 10% increase in steel prices in the last two months. Therefore, the overall costs in
construction sector also showed an upward trend.
Steel prices in US are also surging and hurting many US companies. Furthermore, the rise is expected to lead a further price increase for products such as automobiles. However, the demand coming from
China is not indicated as the only reason of increasing steel prices. The weak US Dollar and shortages of
scrap,
coking coal and
iron ore have also pushed prices. The unprecedented rises in steel prices have threatened contractors and their subcontractors to complete projects.
Auto component manufacturers are also affected from the rising steel prices. Prices cause an increase in material costs and rising costs reduce the profit. Because of this, small business owners have to close their mills.
The price of steel raw materials in
Indonesia is expected to affect the property market. It is forecasted that increase in the prices of building material will also a cause a 20% increase in prices of high-rise buildings and a 15% increase in the prices of steel components.
In addition, steel prices are expected to maintain upward trend this year. Under these circumstances, the
construction and
automotive sectors will continue to be affected from the soaring price increases.