Stakeholders in the construction sector and the scrap metal industry have blamed the dollar for losses they are incurring.
The traders argued that a myriad of factors had contributed to the poor returns including steel and cement prices which have remained high.
Evans Ng'ang'a, the Scrap Metal Dealers Association Chairman, revealed that the lower prices in the scrap industry were highly affected by the strengthening of the shilling against the dollar. The dollar dropped from Ksh160 to Ksh130 in a span of about three months.
"A kilo of copper which we used to buy at Ksh1,000, we are now buying at Ksh600 or Ksh700. That is by virtue of the way the dollar has gone down," he explained noting that the change wiped out Ksh300 form the kilogramme of scrap metal sales in less than three months.
"At the same time, the scrap metal is normally recycled but there is also an alternative of bringing in steel billets from overseas.
"Once the dollar goes down, they are able to bring the billets very easily and at a very cheaper cost," he added noting that the imports reduced the market for scrap metals.
Ng'ang'a further lamented that the lowering of the Importation Declaration Fee (IDF) worsened the situation.
The dealers, therefore, implored the Head of State and the Ministry of Trade to step in and regulate the field for a level playing field.
"What we used to buy at Ksh500, we are now buying at Ksh300 and most of us were found with a lot of stock with us during the dollar reduction," he explained.
"You drop the scrap prices by over 40 per cent, but you do not drop the steel prices. Does it make any sense?"
His sentiments were shared by Edio Kinyanjui, the Willstone Homes Managing Director who is a significant player in the construction industry.
Kinyanjui observed that individuals who had imported goods in bulk while the shilling was still volatile are stuck with stock, most of whom were forced to sell them at a loss.
"Not just steel, cement has also gone up. Even the people that we have on the site, most of the casual labourers and the professionals, we have gotten to a point where they cannot work on the previous leads that we are giving them. We have made a lot of adjustments while increasing their pay," he explained.
"If someone is in the same industry that they were in and recently procured the material and maybe you got bulk when the dollar was a little bit up, merging the two could be a little bit tricky."
This comes as President William Ruto continues to champion industrialisation, specifically in the steel and cement manufacturing sectors, a move likely to lower the costs further.
On Monday, the Head of State championed clinker and steel companies that have already been set up across the country with the aim of delivering affordable houses. He is angling to deliver 200,000 units per year.
