SteelMint has heard from its market sources that rebar producers in Egypt have planned to add to their rebar production capacities in coming next two years.
The companies that feature in this list of adding to the production capacities are El Marakby, Suez Steel, Misr Steel, Kouta Steel, and El Ghonimey Steel and the total capacity addition expected is around 2 to 2.5 MnT. The country’s current rebar production capacity is about 11.6 MnT.
“El Marakby Steel and few others will be starting its new capacity by next year whereas Suez Steel will start operating its new capacity by end of this year”, quoted a local rebar manufacturer in Egypt.
Egypt has been executing a big number of national projects in the last few years supporting country’s steel demand. According to the market reports, about 70% of the production of steel factories is currently being directed to the big national projects that the country is implementing.
Some 3,195 national projects have been executed in the last four years, costing Egyptian Pound (LE) 667 billion and works are currently underway to finish 1,229 projects, with a cost of LE 1.5 trillion, bringing the total national projects to 4,424 projects.
Since 2014, Egypt’s government has been announcing many mega projects to help accelerate the country’s infrastructure development. The projects announced by him includes New Administrative Capital, the Suez Canal Economic Zone, the1.5 million acres reclamation project and Ghalioun fish farming project, thus supporting the country’s steel demand.
“Although at present the country’s steel demand is sluggish, it is expected that demand will grow in the long run as Egypt’s per capita steel consumption is quite low whereas country’s GDP (Gross Domestic Product) and the population is increasing at a rapid pace”, quoted a market participant in Egypt.
Egypt’s government has aimed to reach a GDP growth target of 5.8% for 2018-19, against 5.2% set in 2017-18 budget whereas it is projected to reach 6% till 2022. According to UN (United Nations) forecasts, Egypt’s population is expected to grow from 62.3 million in 1995 to 95.6 million by 2026 and will reach 114.8 million before it stabilizes in the year 2065–an increase of approximately 84.4 percent over the current total.
This increase will occur for two reasons: fertility rates are still high in many parts of Egypt, and momentum will cause the population to continue to increase even after fertility rates reach replacement level.
Egypt’s rebar prices remain stable
The rebar prices in the county which were on a rollercoaster ride (both increased and then decreased) since last week of February has remained stable over past two weeks (since mid-week of April).
Currently, Ezz Steel is offering its rebar at EGP 12,528/MT (USD 708/MT) ex-works basis whereas Suez Steel and El Garhy are offering the same at EGP 12,475/MT (USD 705/MT) and EGP 12,450 (USD 704/MT), ex-works basis.
El Marakby’s rebar offers were last heard at EGP 12,500/MT (USD 707/MT), ex-works. All the domestic prices include VAT of 14%.
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