After sand scarcity, the builders are upset about the steep rise in the prices of steel and cement. The construction industry has nearly come to a “grinding halt” with the builders preferring to postpone projects until the prices come down.
A tonne of steel used to cost about ₹40,000 couple of months ago has touched ₹56,000 now.
According to information, steel price has gone up by ₹20,000 in the last one and a half year. The price used to be around ₹35,000 a tonne in September-October 2017. The prices have been on the rise since then. Also, cement prices have increased significantly. A bag of cement costs ₹330 to ₹ 350 now. The cement prices are up by ₹ 60 to ₹ 100 per bag.
Cartelisation
The builders feel that there is no valid reason for the increase in steel or cement prices. The manufacturers formed as a cartel and jacked up the prices as construction activity would be high during the summer season, builders say.
The rise in building material prices leads to the rise in construction cost. The construction cost would increase by ₹ 50 to ₹ 70 per square feet. The sft construction cost is not less than ₹4,500 on average. The cost varies from ₹ 3,000 per sft to ₹6,000 depending upon factors like area.
As a result, the builders have decided to “slow down works” or stop until the prices are slashed, industry sources say.
In a dilemma
Capital Region Builders Association (CRBA) Chairman Gadde Rajling says that works have come to a grinding halt for various reasons. Availability of sand has come down. The prices of steel and cement have skyrocketed. Steel prices have gone up by ₹ 6,000 per tonne. Cement price is up by about ₹ 100 per bag. A truckload of sand that used to cost ₹ 4,000 in March, costs more than ₹ 15,000 now.
“Either we have to pass on the cost of construction to the buyer or absorb it,” he adds.
