Steel prices rise due to billet import shortage, VAT increase

CAIRO – 2 July 2017: Sale prices of steel announced this July recorded a relative increase, mostly attributed to the instability rate of raw materials import (of billet) to local steel factories. This is also due to a global price hike reaching $ 430 per ton, and a one percent increase in the Value Added Tax (VAT).

“The ton price fluctuated between LE 10,324 ($562.2) and LE 9,950 ($541.8). The price increase resulting from a (VAT) increase by 1 percent, led to a LE 100 increase per ton,” Tarek al Gioshy, chairman of Al Gioshy Steel Group said.

The supply rate of billet is considerably unstable, coinciding with its price hike globally to record approximately $ 430 per ton. Instability is also due to problems faced by some foreign factories. All local steel factories are not operating at their capacity.

“However, steel prices are expected to decrease in the period ahead in the wake of the stability of billet imports to local factories, if the billet-producing factories abroad can resolve production problems,” Gioshy noted.