The New Nation - Internet Edition

UNB, Dhaka

Against the backdrop of a sharp fall in the prices of raw materials, the country's MS rod manufacturers are now apprehending dumping of the product from a neighbouring country.

After the sudden rise in prices of raw materials and finished products, according to industry insiders, neighbouring India imposed a ban on its export of MS rod while Bangladesh relaxed the import of MS rod through withdrawing value added tax (VAT).

But within two months, the prices witnessed a sharp fall on the international market.

Facing this new situation, the Indian policymakers are now contemplating to withdraw the ban on export of MS rod, said an owner of a re-rolling mill who used to import raw materials from India.

If India withdraws ban on export, the Indian manufacturers will try to export their goods and dump those in Bangladesh, he said adding, if that happens, the local manufacturers will have to shut down the industries.

To save the local manufacturers, he said, the government should restrict the import of MS rod.

In last two months, the prices of raw materials of steel and re-rolling products, particularly the prices of melting and re-rolable scraps, have come down to below US$ 450 from US$ 640 per ton on the international market.

As a result, the millers who imported their raw materials two months back have to incur a loss of about US$ 200 per ton, sources said.

According to sources, 40-grade MS rod is selling at between Tk 48,000-50,000 per ton. Two months back, the price was Tk 70,000-plus.

The 60-grade MS rod was selling at a rate of Tk 70,000 per ton, but its price came down to below Tk 62,000.

Owners of steel and re-rolling mills recently informed the FBCCI president about their problems and requested him to pursue the government to save their business.

General secretary of Bangladesh Re-rolling Mills Association Sheikh Masudul Alam Masud apprehended that some millers might have to shut down their mills being unable to absorb the shock of the price fluctuation.

He suggested that the government should first re-impose VAT on the import of MS rod. This VAT was withdrawn as a measure to stabilise the local market when prices went up unusually.