Construction cost goes up amid cement, steel price hike

Cement and steel prices have risen in the local market amid an increase in global commodity prices.

The local cement prices have been hiked by Rs30 per bag (50kg) in the South region i.e Sindh and Balochistan province, it was learnt. As per the latest Pakistan Bureau of Statistics (PBS) numbers, prices in the South region averaged Rs765 per bag prior to the hike and will settle at Rs795 per bag effective on Monday.

Meanwhile, flat steel manufacturers have also raised prices by Rs3,000 per ton.

With the latest hike, the rate of CRC (Cold rolled steel) and Galvanised steel coils will be Rs208,500 per ton and Rs215,850 per ton, respectively. “This is the second hike in the month of February 21 following a PKR 3k/ton price jump on February 10,” sources familiar with the matter informed Business Recorder.

Construction sector hit by steep rise in material cost, claims CAP

The expert added that alongside the coal price hike, depreciation of the Pakistani rupee and rising freight rates has also played their part, as Pakistan imports coal from South Africa and other countries. Similar is the case with rising steel prices as rates of Hot Rolled Coil (HRC) have increased in the international market.

Sources said that as the impact of price increase will be passed on, and the cost of construction would go up, albeit marginally.

MPMG scheme: Banks receive applications worth Rs200bn

Pakistan is a country of over 200 million people, and its high population growth rate fuels urbanisation and with it comes a high demand for housing from almost every stratum of society. There is an estimated shortage of 12 million residential units in the country; most of it is in the low- and middle-income groups, shared State Bank of Pakistan (SBP).

As per Pakistan Economic Survey for FY21, the construction sector contributed 2.5% in GDP. Further, 7.71% of the employed Pakistani labour force is engaged in the construction sector.