An abnormal increase in the price of materials for the construction sector is underway which is putting construction sites at risk and further reducing the margins of public and private procurement companies, already compressed by a decade-long crisis. A slowdown in the works could also come from the fact that some materials are starting to be scarce, for example iron scaffolding, also affected by a strong increase in demand. The price increase started from the end of 2020 and concerns metals, plastics derived from petroleum, concrete and bitumen. Ance, the national association of manufacturers, denounces the phenomenon.
Steel, skyrocketing prices: + 117% in five months
The review of price increases starts from steel and iron: reinforcing bars show an increase of 117% between November 2020 and April 2021. A dynamic that the latest OECD report of last December attributed to the sudden increase in demand for construction industry in China. This rebound has triggered an upward effect on the price of the entire steel supply chain, worldwide, as China accounts for over 50% of world steel production and consumption (40% is absorbed by Chinese construction).
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Added to this are the effects of the pandemic, which resulted in a shortage of supply due to the continuous industrial and commercial closures in the world, and those of the recovery, which generated a sharp increase in demand. The effects were felt above all in Europe, where increases are also recorded in France, Germany and the United Kingdom.
Increases also for polythylene, copper and oil
In parallel with the price increases of steel products, important increases are also observed in other materials of primary importance for construction, such as, for example, polyethylenes (increases of more than 40% between November 2020 and February 2021), copper (+ 17%), oil (+ 34%) and its derivatives, always in the same reference period.
Also for “bitumen”, on the basis of Siteb data, price increases of about 15% are detected between November 2020 and February 2021. To this must be added cement, for which an Ance survey carried out in February on the territory shows increases price of about 10% in January 2021, compared to December, for more than one third of the respondents.