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Pricey Projects Ahead !!

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Here are two important articles from the 05/24/04 Issue of Engineering News-Record.  Both cement and steel costs are escalating rapidly.   
Cement Shortages Pressure Prices

Cement prices have been among the most stable in the construction industry for nearly a decade but that appears to be changing. Cement shortages that first developed in the Southeast are spreading into the Midwest and West, with higher prices and rationing already affecting some regions.

"We had price increases this year and we have customers in the Southeast on allocation,’’ says Tom Chizmadia, vice president of Holcim (U.S.) Inc., Waltham, Mass. The Southeast is particularly affected, but shortages have already developed in other areas, he says.
Holcim’s prices are up an average of 7 to 10%, varying by region.

‘‘Ready-mix producers are concerned about big shortages in the near future, even in areas where there is no shortage today,’’ says Hardy Johnson, the Miami-based president of Titan America’s Florida business, and president of the National Ready-mix Concrete Association.
He says Titan is also seeing shortages in Virginia, Maryland, Texas and California.

Shortages were triggered by a strong economy and good weather in the last three months of 2003 that raised demand 15% at a time producers usually stockpile product for the spring construction season, says Johnson.

Demand in all of 2003 was 107 million tons, 24 million tons beyond the average U.S. production, says Ed Sullivan, chief economist for the Portland Cement Association, Skokie, Ill. Imports normally make up the difference, but most of the dry bulk ships that bring cement into the U.S. are being used to take products to Asia. "Fewer available ships, coupled with the requirement to import nearly one-quarter of U.S. need, has caused a tightening in all U.S. markets,’’ says Sullivan.

Industry officials are not sure how long shortages will endure, but those venturing a guess say it could last a year.

Rebar, Steel Prices Continue To Soar

The crisis in the steel industry continues to reverberate through ENR’s prices.  In May, prices for grade-60 reinforcing bar jumped another 8%, following a 4.5% increase in April and a stunning 12% hike in March. The string of increases combined to raise rebar prices 40% above a year ago. Prices for steel plate made strong gains in May, pushing plate prices 31% above 2003’s level. Structural steel prices also continued to climb, with May’s average 1.9% increase lifting prices 21% above a year ago.