High Exchange Rate: Fabricator seeks local production of Steel
Mr Babatunde Abdulkareen, Managing Director, Muhat Nigeria Limited, has called for local production of Steel in the country to reduce the high foreign exchange rates being spent on its importation.
Abdulkareen, who is into equipment fabrication and general engineering consultancy, made the appeal during an interview with newsmen in Benin on Thursday.
He said that the high foreign exchange rates being used to import Steel had led to high cost of production of fabricated equipment in the country.
“The prices of fabrication materials have gone up. Our suppliers are complaining of the dollar/Naira exchange rates.
“This is affecting our cost of production because almost all the materials we use for fabrication are imported.
“A 2mm stainless plate we used to buy for N22, 000 per sheet is now N35, 000 per sheet while a 3mm stainless plate we were buying for N30, 000 per sheet is now N45,000 per sheet.
“Also, 2mm mild steel that we normally buy N15, 000 per sheet has gone up to N30, 000 per sheet.
“We produce agro allied machines which are mainly steel components and stainless steel is not produced in the country when we have the resources to fabricate.
“The smallest digester that expels oil from palm fruit that we were selling for N350, 000 is now being sold for N450, 000 because of the high cost of materials.
“Also the Dryer used in the production of flour from cassava has gone up from N7 million to N12 million.
“We are praying that our Ajaokuta Steel Company Limited (ASCL) will start working as soon as possible to reduce the cost of fabrication in the country.
He said that the speedy completion of the ASCL would not only create millions of jobs but also promote local fabrication businesses.
“Many people now prefer locally fabricated equipment, and for us to encourage continued patronage our prices should not be too high; if we get materials locally, our prices will be affordable.”
Reports state that the construction of the Ajaokuta Steel Company Limited started in 1979 and it is located on 24,000 hectares of land in Kogi State.
The integrated steel complex was conceived and steadily developed with the vision of erecting a Metallurgical Process Plant cum Engineering Complex with other auxiliaries and facilities.
However, the President Muhammad Buhari administration is intensifying efforts to complete the ASCL with the inauguration of the Ajaokuta Presidential Project Implementation Team in 2020.
