AFTER a strong 2021, thanks to higher selling prices, many steel producers could be looking at compressed margins and a normalisation in selling prices this year.
Amid the expected recovery in demand, steel players are already facing a rise in raw material prices such as iron ore, coupled with higher energy and freight costs.
Nevertheless, an analyst says steel producers could still expect to be profitable in 2022, leveraging on the pick up in construction and industrial activities following the reopening of the economy.
“Global supply chain disruption, stemming from China’s zero-Covid policy and the Russia-Ukraine war, could also keep steel selling prices elevated,” the analyst adds.
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