CAIRO: The price of steel dropped LE 70 per ton, according to the latest report from the internal trade sector of the Ministry of Trade and Industry.
Youssef Darwish, investment manager at ARTOC for investment and development, told The Daily Star Egypt that major construction companies and real estate developers will benefit the most from the lower prices, adding that at times when steel prices surged, sizeable development projects were cancelled due to the soaring costs.
Rose Al Youssef daily newspaper reported that the price has been falling for the past three months.
Darwish said that the downward trend is illogical considering the current circumstances of the industry. Global demand for steel is high and the supply is stagnant, he added, which makes it an inconvenient time for prices to drop.
According to Darwish, steel suppliers will likely take in loses over the coming period. Smaller sized construction companies will not profit that much from the difference in cost.
Maher Abdel Halim, an engineer in a private construction company, told The Daily Star Egypt that the change is funny.
Around 120 to 140 kilos of steel are used to make one square meter of concrete, which is what construction companies mainly use steel for. Since one ton equals 1,000 kilos, then they will only save around LE 15 to LE 20.
The price of other materials used to make concrete – like sand, cement and pebbles – did not decrease, according to Abdel Halim, which means the drop in steel prices does not have a real effect in the construction industry.
