Specialists and officials in companies and laboratories specializing in the metallurgical and machinery industries confirmed that the prices of metals for the equipment industry, led by nickel and stainless steel, rose by up to 200% due to the rise in the prices of raw materials and energy, as well as the rise in shipping costs, noting that demand is witnessing Currently, a decline with the reluctance of consumers due to high prices, despite manufacturers reducing profit margins, which puts pressure on existing industrial investments.
They pointed out that fluctuations in the prices of raw materials for metals are continuing, and taking an upward curve, in conjunction with the continuation of the “Russian-Ukrainian” geopolitical crisis (as Russia’s share is 17% of the production of the finest nickel in the world), in addition to the emergence of epidemiological indicators of the Corona virus in Major global supply markets, as opposed to rising global industrial demand for raw materials.
Nickel prices
On March 8, the prices of nickel metal witnessed an unprecedented rise, as it exceeded 103,000 dollars per ton, before falling back and closing at more than 82,000 dollars, an increase of more than 50% in one day, knowing that the previous record level did not exceed 54,000 dollars, According to the indicators on the investing website, which showed that the price of nickel continued to decline until it reached a level of around $33,000 per ton last week, but despite this it remains higher than its level in November 2021, which ranged between 19.7 thousand and 21.5 thousand dollars per ton, more than 53%.
Nickel, which is the primary commodity for the production of specialized manufacturing minerals according to the American Geological Society, is used in the manufacture of more than 300,000 products around the world, including coins, cooking tools, aircraft engines, batteries, electronic chips, mobile communications devices, electronics, the military industry, defense, advanced technology and all industries. Which requires metal that is resistant to corrosion and erosion and can withstand temperatures up to 1000 degrees.
And “Bloomberg” agency indicated that one of the most important reasons for the “crazy” rise in the price of nickel is that electric car manufacturers increased demand for it to record levels, as sales of electric car companies jumped by 62% during the second half of 2021, to reach 5.84 million cars, prompting it to increase the demand for the metal that makes the production of its cars possible.
industrial investments
The Director of International Sales at Tech Pro Group for the manufacture of digital industrial equipment in Dubai, which operates with artificial intelligence, Engineer Ahmed Amouri, considered that the rise in metal prices globally, especially that it is one of the primary commodities for the production of specialized metals, caused the company’s production costs for specialized industrial equipment to rise by 25%. %, to be reflected in reducing the profit margin in an attempt to maintain the company’s sales.
In his speech to Al Vision, he indicated that the company’s sales of specialized industrial equipment inside the UAE fell 15% last year, which indicates that industrial investment is witnessing a relative decline due to the high costs of establishing industries.
He pointed out that the company’s sales exceed one million dollars annually, but the continuous rise in the prices of metals and commodities that are used in the manufacture of digital industrial equipment, such as electronic chips, will be directly reflected in the prices of industrial products, expecting a further rise in the coming months.
Continuing rise
The owner and general manager of Al Qimma factories for the manufacture of kitchen and restaurant equipment in Sharjah, Alaa Mohammed, said that the price of the “stainless steel” plate for the manufacture of industrial equipment, increased from 150 dirhams regarding a year ago to regarding 460 dirhams today, in addition to the increase in shipping costs by more than 500% in Some of the major manufacturing countries in the world.
He pointed out that some types of stainless steel plates are not available in the market, which increased the prices available locally, so the unexpected rise in the price of primary metals globally during the past month indicates the possibility of a rise in stainless steel prices by more than 200% compared to the previous period due to the repercussions of Global health and geopolitical crises.
global crises
In turn, the director of the “Al-Riyada” factory for manufacturing specialized in the manufacture of metal equipment in Ajman, Khaled Mohammed, expected that the prices of the main raw materials for manufacturing in the company, especially stainless steel, would witness a further rise in light of the time extension of global crises, and the rise in the prices of primary and basic metals for production globally. like nickel.
He said that the costs of establishing most commercial projects that depend on metal equipment have increased by 200% as a result of a number of factors, foremost of which are the lack of imported equipment in the market, the increase in local demand, the high prices in the supplying countries, the increase in shipping costs, the high prices of raw materials, in addition to the high energy.
He pointed out that the high volume of demand, in contrast to the limited availability of equipment, constituted an obstacle to the owners of new projects, which led to insanely high prices on some specialized equipment, which was also reflected in the high prices of equipment in the used market.
synchronous rise
For his part, Director of Al-Talib Aluminum Factory, Ahmed Abdulaziz, said that metal price fluctuations have led to a gradual decline in demand by up to 30% since the beginning of this year, noting that most dealers do not expect the cost of business, and are trying to obtain competitive prices in the market, which is What has become almost impossible at the moment, given that most companies have reduced their profit margins to maintain business continuity, in light of the unprecedented price hikes.
He pointed out that the high cost of raw materials pressured the profit margins of industrial companies, to incur the price difference between the value of the contract and the price of materials for implementation, stressing that prices are rising in conjunction with the rising severity of global health or geopolitical crises.