By: Heba El-Kordy

Cairo – Mubasher: The Ministry of Trade and Industry’s decision to maintain tariffs on steel rebar has boosted the stocks of the Egyptian Exchange (EGX) amid high ratios of liquidity.

The ministry said earlier this morning that it will extend tariffs on steel rebar imports from China, turkey, and Ukraine for further five years to combat dumping.

By 11:25 am Cairo time, Egyptian Iron and Steel rose 1.68%, its highest level since 10 October, to EGP 9.69 at a turnover of EGP 35.9 million exchanged through 3.6 million shares.

Meanwhile, Ezz Steel levelled up 1.46% to EGP 20.09 at a turnover of EGP 36.23 million traded through 29.14 million shares.

Both stocks lured approximately EGP 72.7 million of the EGX’s liquidity.

Trading value at this moment reached EGP 380.5 million through 69 million shares.

The basic resources index added 0.97% to 1,023.56 points, shrugging off the EGX’s declining performance.

Steel imports tariff extension will positively reduce Egyptian iron and steel firms’ fluctuated profits, analyst at Pharos Research Mark Adib said.

Iron and steel companies in Egypt are facing fluctuated profit margins as the prices of iron imports varies, which affect the firms’ local performance and sales, Adib highlighted.

He further noted that the iron and steel companies in Egypt are suffering from low operation rates as Ezz Steels’ operation rate does not exceed 60% in light of high costs, which boost the firm’s losses.

The analysts forecast losses of Ezz Steel to surpass EGP 2 billion in 2017 due to higher costs, noting that the company’s performance depends on its ability to finance its capital.

Ezz Steel had previously posted consolidated losses of EGP 970.2 million in the first half of 2017, up from EGP 616.25 million in H1-16.

Translated by: Mai Ezz El-Din