Finance minister eyes price hike for steel

Government is monitoring the “significant” increase in steel prices on the international market which has the potential to negatively impact the local construction industry.

Internationally, steel companies hiked hot-rolled coil prices in May due to a sharp increase in cost production, amid the second wave of the COVID-19 pandemic devastating global economic activity.

Minister in the Ministry of Finance Ryan Straughn informed the media this week that his ministry has been keeping a close eye on the development and stands ready to make appropriate policy interventions. He said the global supply and logistics chain has had a significant disruption in the last year, leading to an increase in steel prices.

He said as a result, the cost of construction will increase. He said the real challenge will be ensuring that the country has an adequate supply of steel on the island.

“The issue is not having certainty with respect to what the costing will be. Certainly, in the last year, we have seen commodity prices soar in almost every area. And that was in large part due to the fact that the world economy slowed significantly in the last year and therefore we anticipated that with respect to the execution of construction projects, it means then that the costing of those will have to be relooked, but those two elements are just one part of the cost as it relates to a project.

“So I can’t say that it wouldn’t be significant, but I don’t think it will make a significant difference in terms of the potential return in investment in terms of what will be anticipated. So it is a situation which we are monitoring and to the extent that we have already been looking at not just alternatives, but as a country, it means where you source materials from determines the costing for freight, the duties and all those other things that come into play,” Straughn said.
(AH)