THE demand for steel on the local market has declined over the last three months, resulting in a corresponding decrease in prices for the commodity to boost sales.

This is according to reports out of Tank-Weld Metals, the country’s largest importer of contsruction steel.

“All our sales have gone down by 35 per cent in volume, and prices have dropped by about 40 per cent,” Tank-Weld’s Managing Director Bruce Bicknell told the Sunday Observer two weeks ago.

“In the past three months, we have been reducing our prices to match those on the world market,” he said. “We were at $100,000 plus tax per tonne and within the last week we dropped it even further to $70,000 wholesale” .

Bicknell’s report seems consistent with activities on the world market.

For example, Tata Steel in India reported three Fridays ago that based on global rates, it expected local steel prices to fall a further 3,000-4,000 rupees (US$60-US$80) a tonne in the December quarter, and the Xinhua news agency said China’s domestic steel prices had plummeted an average of 12 per cent between October 6 and October 10, the biggest single-week decline since the year 2000.

Similarly, the Associated Press said that in trading on October 22, shares for US Steel fell by 11 per cent from US$4.47 to US$37.88. Nucor fell 56 cents to US $35.50, Steel Dynamics Incorporated declined 88 cents to US$9.86 and AK Steel Holding lost US$1.19, settling at US$12.77.

These movements are however in contrast to local media reports in the week of the Heroes’ Day celebration where the Incorporated Master Builders Association of Jamaica said that steel prices had increased significantly and that there was a severe shortage of the commodity on the world market.

Meanwhile, the decline in demand has negatively affected the local construction sector as is suggested by Tank-Weld’s falling sales. However, Bicknell said the situation presented the Jamaican government with a golden opportunity to boost the sector.

“During this crisis there are opportunities that we can benefit from if we really take advantage of them,” he said.

“Because construction is the largest employer in the country, with all the reduction in prices it is an excellent opportunity for government to spur on investment and create jobs,” he argued.