|
Dubai: Construction companies in Dubai are facing huge losses as ready-mix cement companies are increasing their prices per cubic metre by around 10 to 20 per cent, according to industry sources.
Rizwan Sajan, chairman of Danube Building Materials, said the high prices of materials are impacting hard on the construction companies.
"Because there are so many ongoing projects in Dubai, if a contractor is losing on one project, he can just move to another. It's difficult to find a good contractor and so everyone are suffering."
There are instances when contractors have had to stop work altogether on some projects because factories couldn't keep up with the supply requirements due to the rapid fluctuations in cement prices. Some ready-mix companies have issued letters to clients saying they cannot supply more than 45 per cent of their ready-mix orders.
There are also complaints from construction companies that lorries had to wait for hours to get 200 to 300 bags of cement, which causes long delays to their work and pushes up the cost of construction for the contractor.
The increase in the prices of cement, diesel and chemicals used in the manufacturing process, on top of shipping costs, is thought to be the main reason for the rise in price of ready-mix.
A source at Unibeton Ready-Mix said that a majority of ready-mix companies are increasing their prices and they are being forced to pass on the increased cost of materials to other operators.
Figures show that in the past week, cement prices have increased 25 per cent, with factories blaming the rocketing oil prices for the increase.
Compliance positive response
Cement companies in the UAE have responded positively to the request of the Ministry of Economy to fix prices of cement.
The ministry thanked the companies for abiding by the prices of Dh17 per 50 kg sack and Dh295 per loose tonne of cement for their compliance. Hashem Al Nuaimi, director of the Consumer Protection Department in the Ministry of Economy, said the ministry will meet the directors of cement companies to review prices and production costs.
|
