Beirut blast glass creates a surge in demand for aluminum. Lebanon News


Beirut, Lebanon – On 4 August, a deadly explosion from the port of Beirut broke all windows and glass doors within several kilometers around it.

After the explosion caused by an explosion of about 3,000 tons of unsafe ammonium nitrate, pieces of broken glass could be heard on every street-corner as millions of pieces swept through the littering streets of the capital.

The explosion left the country’s economy – already struggling due to the breakdown of its banking system, skyrocketing inflation, and the COVID19 epidemic – in strife.

But there has been an upsurge in demand in an industry since the explosion – highly sought after glass and aluminum for reconstruction.

With the destruction of tens of thousands of homes and businesses, the need for building materials – especially glass and Aluminum – The roof is gone.

But as demand rose, prices rose, leaving many Beirut residents in open-air flats, unable to afford replacement for their broken windows and doors.

Skyrocketing demand

Due to the prolonged economic slowdown and political instability in the country, demand for building and construction materials was negligible before the explosion.

But about 70 percent of Beirut buildings were affected by the explosion, according to experts, the need for glass and Aluminum Never been the same before.

Khalil al-Ghoul, a Lebanese company shareholder, said that with the economic crisis affecting the construction industry very badly, our production has come down to 25 percent in the last 18 months.

“But since the explosion, production has grown by 200 percent. Work is booming for everyone involved in glass and Aluminum Industry, “al-Ghoul said. This is peak time.”

According to Ismail Ahmed, the owner of a small shop in Zukq al-Balat in Beirut, the number of glass windows and doors has doubled since the mass explosion.

“I had seven or eight customers a week before the explosion, now it’s at least 15,” Ahmed said.

For a few days after the explosion, a piece of broken glass can be heard in every corner of the city [Arwa Ibrahim/Al Jazeera]

Despite increasing demand, Ahmed said that he did not make any profit. He explained that while he is selling his products at very high prices, he was forced to pay too much for them as costs rose sharply, especially during the first week after the explosion.

“Before the explosion, a square meter of transparent glass cost $ 10, while frosted glass was about $ 14,” Ahmed said.

“Prices are now $ 14 and $ 24 [respectively], ”He said, explaining the operational and transportation costs covering $ 4 – $ 5, leaving him with only a nominal profit.

Loss reduction

According to Nada Nme, Vice President of Consumer Lebanon, an organization that works to protect consumers from exploitation, although small glass and Aluminum Retailers like Ahmed were still making more profit than before the explosion, with the wholesaler controlling the market being the biggest gainer.

“Big traders have certainly taken advantage of the situation,” Nme said.

“Many of them are still selling glass and Aluminum He said that the profit margin of the products that have been stored may increase by 50 percent.

According to Lebanese economist Patrick Mardini, demand for building materials increased because there is a modest return for people in the industry after the explosion.

“People working in explosion glass and Aluminum Mardini, head of the Lebanese Institute for Market Studies, said they were experiencing a recession in recent years.

“They are only reducing their losses, not making big profits,” he explained, while the Lebanese economy has deteriorated since the August 4 incident, with little benefit to those working in the construction industry it happens.

“The reason for the high prices is hyperinflation and policy monetization is debt,” Mardini said. “The real problem is not the merchants, it is the government that is not ready to improve and stop spending more than its income.”

Economic Crisis

Before the explosion, Lebanon was already facing its worst economic crisis in decades. Thousands of people were unemployed and companies were forced to close as businesses closed.

For 20 years, the exchange rate of the Lebanese pound was estimated at a rate of 1,500 Lebanese pounds to one US dollar. But since October of last year, the value of the Lebanese pound has declined, dropping 80 percent in value and reaching $ 9,000 at one point.

With Lebanon relying on borrowings to pay for imported goods – which constitutes the majority of the nation’s consumption – the currency’s collapse meant that imports were no longer affordable. Rising inflation also meant that many households could no longer afford basic goods.

By 2019, the central bank tried to stop the flow of money out of the country. It stopped providing dollars to importers for anything other than wheat, fuel and medicine, and limits could be placed on the amount of dollars people could withdraw from their accounts. It proposed new taxes on petrol, tobacco and voice calls on apps such as WhatsApp.

The move caused panic among thousands, as the depreciation of the pound severely affected disposable income and food prices.

The central bank said that after the explosion it would direct banks and financial institutions to give extraordinary loans at zero interest to the individuals and firms affected by it.

Trade in glass and aluminum is booming after the Beirut blast

Thousands of buildings have been left without glass windows and doors after the explosion [Arwa Ibrahim/Al Jazeera]

Meanwhile, the Lebanese government promised to subsidize the price of materials needed for reconstruction – including glass and Aluminum – To help people repair their homes.

But according to many observers and businessmen, this has not happened.

“The government never implemented this decision. The price of glass and Aluminum For consumers it has either doubled or tripled, ” said Neme.

Many see it as the responsibility of the authorities to keep the watchdog of the traders and ensure the exploitation of consumers.

But despite the demand for a government cap on the cost of construction materials after the explosion, Mardini says the move will only create a major problem.

“If the price of building materials is set lower than their cost, these products will end up in a black market at very high prices,” Mardini explained.

Many countries, including Egypt and Algeria, announced large amounts of glass donations and Aluminum To support the reconstruction process.

However, it is unclear who received these donations, or if they reached everyone, according to many in the industry.

‘Unaffordable’

Even before the COVID19 epidemic, the World Bank estimated that 45 percent of Lebanese people would live below the poverty line in 2020.

Increase in the price of glass and Aluminum The products have left thousands of people affected by the explosion unable to replace their broken windows and doors.

In the 78-year-old Hard neighborhood of Mara Mikhail, sitting on a red couch in the middle of his modest two-bedroom flat between Nicholas Nahs and his wife Rita, 62, said they were waiting for a charity organization to help them Were staying.

Nicholas said, “Whether it is the kitchen, bedroom or this living room, there is not a single place that is windowless and without doors.”

Trade in glass and aluminum is booming after the Beirut blast

The windows and doors of Rita and Nicholas Nahs’ house are shattered in the explosion [Arwa Ibrahim/Al Jazeera]

“But I can’t afford to change any of them,” he said.

Nicholas said that while volunteers at an NGO measured for new windows and doors last week, he was still awaiting installation.

“If the weather turns cold, we are doomed,” said his wife, Rita.

Across the street from the old couple’s flat, a group of young volunteers were working hard to repair several homes in the deprived area.

“The most obvious requirement is glass and Aluminum, “25-year-old volunteer Elio Yacoub said,” Every household needs new windows and doors.

Volunteers, some of whom are architects and construction engineers, said they relied on the receipt of donated windows and doors to fix what they could do in the area.

“But there’s only so much that we can do,” Yacoub said. “There is a greater need than what we are supplying.”

While many traders in glass and Aluminum The industry says they are still selling mostly stored glass and aluminum products, they will eventually be forced to import new materials to supply demand since the explosion. But they may not be able to afford it.

Follow Arva Ibrahim on Twitter: @arwaib

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