KUALA LUMPUR – The Statistics Department said the unit price index of cement rose 2.6% in January 2023 from December 2022 due to the increase in coal price and higher shipping costs.
The unit price index of steel went up 1%, coinciding with the increase in the price of iron ore and steel at the global level.
According to Trading Economics, iron ore prices are expected to rise following the recovery of China’s factory activity in January after three straight months of contraction reported by the China National Bureau of Statistics Manufacturing Purchasing Manager Index, chief statistician Datuk Seri Mohd Uzir Mahidin said.
“Additionally, the end of the zero Covid-19 policy in China and various initiatives to stimulate construction activity is expected to strengthen the real estate sector and housing demand.
‘’This expectation will increase the demand for construction and industrial inputs that use materials from iron ore and steel,” he said in a statement today.
Uzir said the World Steel Association’s Short-Range Outlook for 2022 and 2023 projected demand for steel in 2023 recording a growth of 2.2%.
The Global Steel Outlook 2023 released by Fitch Ratings also expects incremental growth in steel consumption for 2023 in markets such as India, Southeast Asia, and the United States.
The report added that among the factors affecting short-term supply and demand in the steel market are the evolution of the Chinese property market and timing of the easing of the country’s lockdown.
“Geopolitical issues such as continued trade pressures from the war in Ukraine and sanctions against Russia and the US-China trade tensions may also affect the steel market,” he said.
Year on year, the unit price index of building materials rose between 0.7% and 11.4% in January 2023 compared with a year ago, with the unit price index for steel and cement increasing by 1.4% and 9.3%.
Uzir said the average price per unit of steel consisting of mild steel round bars and Mycon 60 high tensile deformed bars was RM3,599.37 per tonne, recording a 0.7% increase compared to December 2022 of RM3,576.00 per tonne.
The average price of cement (Ordinary Portland) recorded an increase of 3.4% at RM21.66/50 kg compared with RM20.95/50 kg in December 2022, while the average price of sand remained unchanged at RM36.32 per tonne.
He said the Building Materials Cost Index (BCI) (without and including steel bars) for all building categories in Peninsular Malaysia in January 2023 increased between 0.5% and 2.5% compared with the previous month.
For Sabah, the BCI showed an increase for almost all construction categories between 0.9% and 2.6% in January 2023 compared with the previous month and in Sarawak, it expanded between 0.1% and 1.3%. – Bernama, February 7, 2023
