Malaysia hikes prices of certain steel products
Reports from the industry indicate a price increase by Malaysian government last week in ceiling price of billets and retail price of steel bars by RM 419/t (around $111/t) and RM 356/t (around $94/t) respectively. Price increase, which is currently in effect, is decided upon the price improvement in scrap used in billet and steel bar production. It is aimed that supply shortage faced by construction industry will be eased through this hike in prices. Besides, this news has already been welcomed by contractors. According to the statement of Domestic Trade and Consumer Affairs, ceiling price for all types of billets are at RM 1'294-1'389/t (approx. $342-368/t) level, depending on the size. Meanwhile, retail price for mild steel round bars and high tensile deformed bars are now ranging between RM 1'351-1'675/t (approx. $405-443/t), referring to an increase of 30% utmost. It is reported that the price increase will have negligible affect on overall construction costs, such as a 2-3% hike. On the other hand, government will have to allocate additional RM 35.5 million (around $9.4 million) in order to cover housing projects as they are conducted by National Housing Department. By the way, the “automatic price mechanism” which will adjust ceiling price of the material in line with the current scrap prices automatically is still being studied by the government.