Steelmakers in Bangladesh are facing a severe working capital shortage due to the sharp rise in the US dollar exchange rate and a slowdown in sales, according to industry insiders.

The country’s steel production fell significantly in September compared to the previous year as the industry reeled from a damaging slump in demand and subsequent price reduction.

The demand for steel in Bangladesh has almost halved over the past two months as most construction works have been halted following the recent political changeover, according to industry people.

Chowdhury also said it is really difficult to predict when the demand for steel will rise once again as no one knows when the ongoing economic crisis will let up.

Steel consumption in Bangladesh is projected to rise by 25 percent to around 1.06 crore tonnes in 2027 from 85 lakh tonnes in 2024 thanks to growing infrastructure development projects and individual consumption, according to Bigmint.

Operational costs of the country’s steel sector have increased by 65 percent over the past year, posing a threat to the loan repayment capability of manufacturers, according to Bangladesh Steel Manufacturers Association (BSMA).