Islamabad – Steel rebar prices have surged for the second time in a week, marking a significant jump from the range of Rs259,000 to Rs264,000 per ton just one week earlier on October 31st. This sudden price hike is likely driven by multiple factors.
Supply chain disruptions, potentially impacting the procurement of raw materials, coupled with the ongoing slide of the rupee against the dollar, with the exchange rate fluctuating between Rs283-286, are contributing to these challenges in the steel market.
The 11-day consecutive decline in the rupee-dollar exchange rate, hovering around Rs283-286, is of particular concern. A weakening rupee can make imports of raw materials more costly, affecting production expenses and in turn, steel prices. This exchange rate volatility is compounded by global economic and geopolitical dynamics influencing currency markets.
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The combination of these supply chain issues and currency fluctuations creates uncertainty for steel producers. They may pass on increased costs to consumers, resulting in higher steel rebar rates. This situation impacts not just the construction sector, where steel is a crucial material, but has broader economic implications.
Efforts to stabilize the situation may involve strategic sourcing of raw materials, monitoring currency markets, and building supply chain resilience to mitigate the impact of these challenges on the steel market.