What is the solution to "cool down" the price of construction materials?

BAC GAING - Scarcity of construction materials has pushed up prices, causing many projects to cost more. Contractors and construction workers are not only facing financial difficulties but also at risk of delays due to lack of construction materials. What consequences is this causing? What solutions are there to "cool down" the prices of construction materials?

Construction waiting for materials

Currently, the high price of construction materials has made construction difficult for many contractors as well as people. In particular, steel prices have fluctuated since the beginning of April this year and increased sharply since mid-April. Specifically, rebar increased by 950 VND/kg, rolled steel increased by 550 VND/kg, D10 iron increased by 1,100 VND/kg and is expected to continue to increase in the coming time. Particularly, the price of rebar from May 22 continued to increase by 200 VND/kg, rolled steel increased by 150 VND/kg.

Project to build a factory to produce and process mechanical, electronic components and escape equipment (Luc Nam).

According to some contractors, along with iron, cement prices at all factories nationwide have increased since April 22 this year by VND50,000/ton. Prices of black sand, yellow sand, and stone in the market have also increased, currently the price of yellow sand is VND730,000/m3, mixed sand is VND470,000/m3, stone is VND520,000/m3, and plastering sand is VND450,000/m3. Ready-mixed concrete is VND1,500,000/m3, an increase of about VND300,000/m3. Although contractors have to increase the cost of purchasing materials and pay in advance, they still cannot buy materials. This price fluctuation has a great impact on construction costs.

In addition, the price of construction bricks has also fluctuated strongly, increasing since the beginning of January this year due to the increase in input materials such as: Clay, coal, and electricity prices, and the bustling construction activities, so bricks have the highest price in many years. Specifically, the price of red brick KT 205x95x55 increased by 500 VND/piece, double solid brick KT 205x150x55 increased by 900 VND/piece, XMCL brick KT 210x100x60 increased by 140 VND/piece, XMCL brick KT 390x100x130 increased by 505 VND/piece; XMCL brick KT 390x150x130 increased by 988 VND/piece (excluding VAT) in just 3 months. Customers have difficulty buying materials, often having to wait in line for a long time and have to pay immediately.

According to a representative of LICOGI 13 FC Joint Stock Company ( Hanoi ) - the contractor for the construction of a factory for manufacturing, processing mechanical, electronic components and emergency escape equipment (DONGTAI VIET NAM) in Lan Mau commune (Luc Nam), although the unit had ordered construction materials in advance, it took the steel supplier a whole week to receive the goods. Each time, the unit could only get 1 or 2 trucks of goods, which interrupted the contractor's construction process. Moreover, the conditions for purchasing steel were very strict, requiring 100% payment of the order value in advance, not allowing debt, causing great financial pressure on the contractor.

The lack of materials also affects the construction progress of the project. “We are like “sitting on fire” because there are no construction materials. Meanwhile, we still have to pay workers every day to retain workers and other expenses, more worrying is the risk of not being able to complete the project on time as committed to the investor” - Mr. Tran Van Hung, Deputy General Director of LICOGI 13 FC Joint Stock Company said.

A field survey at the road construction site connecting Provincial Road 292 through An Ha Industrial Park (Lang Giang) to the Northeast Ring Road ( Bac Giang City) revealed that these days, the contractor is mobilizing machinery and workers to construct package No. 6, including road and bridge items on the route. These items require leveling soil, sand for pouring concrete on some bridge piers and steel for making bridge girders. However, at this time, the contractor's construction is facing many difficulties, affecting the progress due to the scarcity of construction materials and high prices.

According to Mr. Ngo Quoc Dat, the site manager, in the past month, contractors have had difficulty purchasing land for leveling and sand for road and bridge construction. Currently, the unit has only purchased 22,000 m3 of land for leveling, still lacking about 48,000 m3, but in the district there is only one licensed mine in operation, so it is not enough to supply for the project. Not only is the supply scarce, the price of land for leveling is also higher than it was more than a month ago, making it impossible for contractors to continue construction.

Soon there will be a stable solution

At this time, construction material businesses such as: Iron and steel, bricks, concrete are also lacking in supply, unable to meet customer demand. According to Mr. Nguyen Van Binh, a shop owner in Tan Dinh commune (Lang Giang), for many days now, his family has received continuous phone calls to order steel but does not have enough goods to sell because they have not been able to import input materials. Similarly, many ready-mixed concrete businesses are also in a state of "out of stock" due to a lack of production materials.

Construction materials store in Xuan Huong commune (Lang Giang).

According to the Department of Construction, the recent increase in construction material prices has negatively impacted construction activities in the area. Currently, the Department is grasping this issue to synthesize and advise on solutions to resolve it. At the same time, in order to ensure the announcement of construction material prices appropriately, promptly, close to market prices, meeting the requirements for construction investment cost management, the Department of Construction requests the People's Committees of districts, towns, cities; project management boards, associations to coordinate with specialized construction agencies at the district level, investors, enterprises related to construction investment cost management, production and trading of construction materials to provide price information documents (actual material prices, quotations, contracts, copies of sales invoices...) for some main types of materials including: Filling soil, cement, construction bricks, sand, stone, gravel, construction steel... for the Department to synthesize, complete, and coordinate the announcement of material prices in the province.

According to the Department of Construction, the recent increase in construction material prices has negatively impacted construction activities in the area. Currently, the Department is grasping this issue to synthesize and advise on solutions.

On this issue, many construction enterprises have proposed that the State stabilize the market soon, take the initiative in supply, especially have support solutions, and quickly increase the production capacity of supply enterprises. Along with the above solutions, it is possible to consider and specifically evaluate lump-sum contracts to ensure the rights of investors and contractors. Calculate the total investment in project approval based on closely updating the market situation; speed up administrative procedures in licensing mineral exploitation, increase the supply of construction materials. Contractors when having materials need to focus on construction, completing the project soon to limit the impact of fluctuations in material prices.

Article and photos: PVKT Group

Source: https://baobacgiang.vn/giai-phap-nao-ha-nhiet-gia-vat-lieu-xay-dung--postid419303.bbg