JEDDAH: The price of iron has decreased by around SR500 per ton thanks to a group of contractors and builders who recently boycotted iron, compelling iron factories and retailers to lower prices which had reached an unprecedented SR5,400 per ton.
“This is a new tactic which has succeeded in bringing down the price of iron. We will continue. We now have strong indications that prices will go down by about 29 percent at the end of September, reaching SR3,800,” a contractor, who spoke on condition of anonymity, told Arab News.
“We are sick of greedy retailers and manufacturers, and their attempts to increase prices. I was forced to stop the construction of my new house until these people lowered the prices,” said Naif Al-Salam, a Saudi citizen.
Al-Salam added that the Ministry of Commerce and Industry has begun inspecting prices in the market in a bid to curb spiraling costs of iron.
Sharif Abu Ouf, a contractor, said that Saudi Basic Industries Corp. (SABIC) and other local factories began increasing the prices of iron at a time when the supply of iron had decreased. “Many contractors had to stop their projects... Contractors came together for the first time and stopped buying iron because they were losing out,” he said.
Abu Ouf said the contractors had decided to stop buying iron spontaneously and that they had not previously agreed to do this. He added that the move forced local factories to lower prices.
Nasir Al-Ahmed expressed satisfaction over the reduction of prices and said nobody, even the most optimistic, could have imagined such a drop. “It is unbelievable. The prices have reached fearful levels, which retailers have attributed to increases in the international market. Today we have a reduction that we could not have imagined before,” he added.
The drop in sales during the boycott was estimated to number around 80 percent, something that led factories to resort to advertising their goods in the national press.