Builders cheer as round bar price drop

Prices of some of the construction materials have considerably gone down thanks to economies unlocking from the Covid-19 pandemic and government intervention.

‘Daily News’ spot survey showed that prices for some of construction materials, especially steel round bars and corrugated iron sheets, started to ease soon after the implementation of 2022/23 fiscal budget was started while imports of raw materials improved significantly.

The raw material improvement in the market propels local manufacturers to increase supply hence suppressing demand and at the end of the day quell prices by between 3.0 and 15 per cent for steel round bars.

The Deputy Minister for Investment, Industry and Trade Mr Exaud Kigahe said the government’s fuel subsidy managed to contain local fuel prices thus lowering the cost of transport while reducing some taxes for some construction materials assisted in easing import charges.

“After stabilising prices in the market, we are currently talking with steel rolling firms to identify obstacle areas to further lower construction material prices,” Mr Kigahe told Daily News adding:

“The government goal is to make construction materials affordable to enable citizens to build better houses….”

The current obstacle the manufacturers are facing is power and water rationing which is the outcome of the worst drought that hit the country in recent years and the government works around the clock to ease the impact of both on the economy as far as the manufacturing sector is concern.

The survey showed that the 8.0 millimetres steel round bar price dropped by 3.5 per cent to 13,500/- yesterday from 14,000/- per bar last July. The 12mm price went down 15 per cent to 22,000/- from 26,000/-.

Also, the 16mm dropped 6.5 per cent to 43,000/- from 46,000/- and 25mm went down by 13.3 per cent to 95,000/- from 110,000/- per bar in June.

The MM Integrated Steel Mills, Marketing Manager, Mr Raghu Patel said they were affected by the ongoing war between Russia and Ukraine since their imports raw material from Moscow.

“The products went down but after switching to China we are back on the saddle….Now we can produce 25,000 tonnes per two weeks, depending on orders. This soothes demand to cut down prices,” Mr Patel told Daily News.

On top of that, he said: “We also thank the government for being able to create a very good system for us to get our import consignment on time.”

Steel iron bar dealer at Buguruni, Mr Baraka Manyota, said that the bar prices have come down sending relief not only to them but also to buyers and customers are increasing.

“Low prices have boosted our sales and we are getting fresh supply from factories immediately after placing order…thanks to price dropping since July,” Mr Manyota said.

The minister of finance and planning, Dr Mwigulu Nchemba said when tabling 2022/23 budget in July, said that the government will take deliberate measures to reduce the cost of living caused by the effects of the Russia-Ukraine war.

The measures taken included cutting price hikes in petroleum products by reducing several levies that are factored in the computation of cap prices for petroleum products—petrol prices in Dar went down from 3,300/- a litre to 2,850/-. The government is paying an average of 100bn/- every month as a fuel subsidy.