The price of steel and steel-based items used in the construction industry has declined 25% in the last nine months following a fall in global prices of the metal due to flagging demand from China’s real estate sector.
The cheaper steel, a key commodity in the construction sector, will relieve developers who have also had to contend with higher prices of other building materials, including cement, timber and iron.
“In January, the price for refurbished steel bars was going at Sh130 per kilogram (kg), plus value-added tax (VAT), which has significantly reduced to Sh95 per kg. For steel tubes, the price has gone from Sh160 to Sh120 in the period,” chairperson of the Kenya Metal and Allied Sector Bobby Johnson as quoted by Business Daily.
The prices of some metal products had increased by up to 40 per cent in the first quarter of this year due to a shortage that had been occasioned by supply fears related to Russia’s onslaught on Ukraine, which began in February.
Russia and Ukraine account for nearly 20 per cent of the global export of the metal.
This saw the price of a kilo of steel go up to Sh180 by the end of March before beginning to retreat in the second quarter of the year as global demand flagged, which resulted in higher costs for builders, some of whom had already inked contracts that factored in lower prices of the material.
Mr Johnson further suggested that stable policies help the growth of the industry, which will eventually help ease volatility in prices.
Read also; Government to Lift Scrap Metal Ban on 1st May.
