Construction cost elevated by almost 40 percent to hit a new high

Construction cost

There has been an extraordinary upsurge in the cost of energy and petroleum products and high market demand, resulted in the increase in the price of nearly all construction materials all over Punjab, exclusively the provincial capital. 

A former chairman of the Pakistan Steel Re-rolling Mills Association (PSRMA) Asmat Pervaiz, while conferencing with the media, revealed that charges of steel products, including angles, bars, girders, pipes, and sheets, are at unprecedented high due to increased production cost, exaggerated demand, and restricted manufacturing capacity. 

The prices of branded or graded steel products are flying between Rs 185,000 and Rs 187,000 per tonne, whereas local steel has been sold for Rs 160,000 to Rs 165,000 per tonne in different areas of the province. 

Mr. Pervaiz further said that the upsurge in energy tariffs has elevated the construction cost by almost 40 percent. 

Read more: Housing and construction finance up 75 percent in FY21

“Right now, a bullish trend is being witnessed in steel markets across the country. Buyers have to wait for a week or so after making payment to get their orders delivered owing to very high market demand,” the business leader exposed. 

He said that after the coronavirus lockdowns, about 20% of small steel industrial units could not recommence operations which have also reduced the industry’s capacity. 

Meanwhile, Prime Minister Imran Khan has announced a construction package that has also generated an enormous demand for all construction materials, like aluminum, steel, glass, and electrical fixtures pushing their cost further. 

“The demand is so high that builders do not even bother to ask the price. They just want a smooth supply of required material to avoid loss of working days,” he pointed out. 

He anticipated that the expenses of steel products and other building materials would further be raised with stability in Afghanistan, which will afterward be followed by the growth of the local industry. 

Moreover, a glass dealer, Muhammad Shahid, underscored that the rates of aluminum and float glass have been raised by about 25% in the past two months as a result of increased demand and high manufacturing costs. 

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