The Peninsula reported that the prices of steel which is one of the basic raw materials for the construction industry are suddenly up more than 10% triggering fears the move might have a spill over impact on inflation.
From an average QAR 2,500 per tonne the rate of locally produced steel has soared to over QAR 2,800 raising serious concerns among contractors who have submitted tenders for projects based on earlier prices.
Qatar Steel produces quality steel and meets the local demand almost single handedly. The demand for steel has been on an upswing in neighbouring countries where the sagging construction industry is recovering faster than expected.
According to construction industry sources, one of the major sufferers are the nearly 5,000 citizens who have been given long term soft loans by the Qatar Development Bank to build their homes.
The beneficiaries all of them government employees have been given housing loans of between QAR 600,000 and QAR 1.2 million but most of them are now under pressure from contractors to pay more for construction due to steel becoming costlier. The beneficiaries have already been complaining that the loans they have been provided are not sufficient to build homes and a sudden raise in steel prices has further frustrated their tight budgets.
Distributors said that they are not to blame for the price rise and the company is responsible. Qatar Steel could not be, however, contacted for comment immediately.