Insights to Q4 2021 construction prices
The hike in prices of prime construction materials like steel, diesel, cement, copper, aluminum and PVC have been ‘steep’ and unprecedented in the past six to eight months
The past one year, the build environment has remained heavily loaded with prices of major key construction materials, resulting in cost uncertainty on a major scale in the Indian Construction Industry.
Since Q1 2020, steel is up 45-47% to INR 62,300/MT, copper also at 70-75% to INR 745,000/MT, followed by aluminum at 55-50% to INR 203,385/MT, PVC items by 80-90% to INR165,000/MT, and last, but not the least, fuel (primarily diesel) by a whopping 43-47% to about INR 94/litre.
Cost of labour too has risen 10-15%, besides the regular increase, due to the knock-on impact of COVID-19 protocols and its associated costs. This includes costs related to compliance to new protocols like RT-PCR tests, idle time until test results, increased accommodation space for the same amount of labour, quarantine facility and sanitation measures. In addition to that, additional labour retention and transportation costs put together has contributed to the increase.
The volatility is here to stay for a while until industry shows a steady sign of recovery along with other sectors like manufacturing, hospitality, FMCG, Infrastructure, Leisure etc.
