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Posted On: 3 June 2008 08:36 am
Updated On: 12 November 2020 02:08 pm

Construction industry suffering from inflation

Khalifa Al Haroon
Khalifa Al Haroon
Your friendly neighborhood Qatari
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QATAR’s construction industry has been hit hard because of price escalation, severe sand shortage and inadequate supply of cement. Cement, sand, paint, waterproofing and sanitary materials have all seen a huge increase in prices in the last one year, industry sources said yesterday. Qatar’s General Secretariat for Development Planning (GSDP) yesterday revealed the first quarter inflation which stood at 14.75% and propelled by a surge in food and commodity prices and rents. Imported cement prices have gone up by 10% to 15% in the past one month, Gulf Times’ inquiries reveal. The wholesale price ranges between QR19 and QR22 a bag, though they go up to QR30 in the retail market. Cement crisis in Qatar is due to the demand-supply imbalance. The local production has not matched the actual requirements. Nevertheless, the local producers have stepped up production. What has reportedly aggravated the situation is the ban on cement imports from Saudi Arabia, the top cement producer in the Gulf region, and India, traditionally a big supplier to the region. Although Qatar Sand Plant, the country’s only producer of treated (washed) sand, has not increased the price, it has shot up due to severe shortage and higher transportation costs. The delivery price at Qatar Sand Plant is only QR22 a tonne, but it costs up to QR100 a tonne (including transportation costs) in the retail market. The soaring demand for washed sand has resulted in restrictions on supply. The manager of a leading construction firm yesterday said bitumen price might go up further as some Dubai-based companies had temporarily suspended supply citing impending price revision. A bitumen roll costs QR88 now in place of QR74 in early 2008. Bitumen, a tar-like substance and a byproduct obtained during crude oil refining, is used for waterproofing. The red hot oil price has pushed up bitumen costs as well. Sanitary fittings have also seen price spike in the last few months. Copper pipes used for water supply now cost as much as QR75 for six metres (15mm thickness). A shower mixer costs about QR150 now in place of QR100 early this year. Steel prices are also galloping but the local industry can heave a sigh of relief in Qatar Steel’s decision to hold prices till the month-end. Recently, Qatar Steel said its prices would be lower than those in the neighbouring markets. Qatar Steel fixed the retail price for standard sizes of steel (16mm to 40mm) between QR3,250 and QR3,300 a tonne. Describing the move as one to fight inflation, Qatar Steel said the prices would be lower by around QR1,000 a tonne. Gulf Times Does anyone know why there's a ban on Saudi and Indian Cement?