A controversial decision of Chittagong Port Authority (CPA) may push up the price of steel rods, one of the main construction materials, at the local market, according to industry insiders, reports UNB.
They said the Port Authority Wednesday imposed a ban on unloading of imported melting scraps, the prime raw material for local steel mills, on the port premises.
CPA directed the mill operators to take the delivery of their imported materials directly from the vessels through containers and then unload those on their mill premises.
The steel mill operators found the decision unrealistic and feared that it might lead to an increase in their production cost.
They argued that this decision of the CPA would seriously destabilise the local steel market.
They said this would force them to rent containers for bringing their raw materials to their mill premises.
Under the existing arrangement, the mill operators unload their materials from vessels on the port premises and then carry those to the mills by trucks.
But after the ban, the mill operators will now require to hire containers for carrying those to their mills. For this new system, the mill owners claimed they would have to count extra cost for hiring the containers to carry the materials.
"For carrying a container, we need to hire a trailer at a cost of between Tk 18,000 and 20,000," said a miller.
Besides, the mill operators have to deposit Tk 1,50,000 for a 20-foot container and Tk 3,00,000 for a 40-foot one with the container companies.
"This will raise our production cost by Tk 3,000 to 4,000 per tonne of steel rods," said Sheikh Masadul Alam Masud, General Secretary of Bangladesh Re-rolling Mills Association.
"This means the price of 40 grade steel-rod may go up to Tk 37,000 per tonne from the present rate of Tk 34,000 and the price of 60 grade may shot up to Tk 42,000 per tonne from Tk 38,000," he added.