Housing
Developers Claim That Steel Bars Still In Short Supply
Bernama.com 24/4/2004 By Farazira Amira Yusof
KUALA LUMPUR, April 24 (Bernama) -- All is not well with the local
supply situation for mild steel round bars and high tensile deformed
bars despite the government having allowed an increase of between
26.9 percent and 30.3 percent for these products recently, say
housing developers.
And there is also black marketing because housing developers are
still facing a critical shortage of steel, they add.
"It's really unfortunately, the shortage still continues and supply
(of steel is) still not available at the government price," claimed
Datuk Jeffrey Ng Tiong Lip, chairman of the Real Estate and Housing
Developers Association (REHDA).
He told Bernama that the tight supply situation had forced many
developers and contractor to procure steel bars at "black market
prices" which obviously were significantly more expensive.
Steel bars on the black market are currently sold at RM350 more per
tonne than the government listed price.
"They (black marketeers) claim that higher prices are reasonable and
justifiable after taking account their handling charges and other
charges," he said.
The government had recently increased by RM419 per tonne for billets
and by RM356 per tonne for mild steel round bars and high tensile
deformed bars due to the rise in scrap iron price on the
international market.
As a result, prices of billets now ranged between RM1,294 and
RM1,389 per tonne while prices of steel bars ranged between RM1,531
and RM1,675 per tonne.
For Sabah and Sarawak, the steel price would be RM50 more per tonne
than that in Peninsula Malaysia because of freight charges.
Ng said REHDA hoped that the government could monitor this situation
and ensure that there was adequate supply of steel bars required by
the domestic market.
Exports of steel for higher returns should also not be at the
expense of local users, he said.
At the recent Ministry of International Trade and Industry (MITI)
annual dialogue, REHDA had suggested that in order for price
controls to be effective, there must be adequate enforcement to
ensure that millers produced ample percentages of the types of steel
needed by the local market.
The association appealed to the government to be more strict in
monitoring the distribution channels to prevent users from having to
pay additional charges on the black market.
REHDA said any substantial increases above the controlled prices
would definitely lead to higher house prices.
For the housing sector, REHDA had estimated an average of 300,000
tonnes of steel were required for the production of 150,000 housing
units per annum.
REHDA had also received reports from its members that there had been
serious project disruptions as a result of this artificial shortage.
In the worst case scenario, the housing industry would stand to
suffer losses close to RM7.4 million daily in liquidated and
ascertained damages contractually payable by developers to
housebuyers as a result of late delivery if this problem was not
quickly addressed, REHDA said.
-- BERNAMA |
| |
|
