Surging steel prices to increase apartment costs

APARTMENT prices could rise by up to €10,000 because of spiralling steel prices, the Construction Industry Federation (CIF) has warned.

CIF director Don O’Sullivan said contractors were paying up to 50% more for reinforcing steel and up to 20% extra for structural steel since January.

He said the dramatic increase in prices was putting pressure on contractors and could have an impact on the costs in other industries.

Developers involved in major projects, such as industrial or commercial building, are being hit the hardest.

“The CIF feels that this problem will impact on contractors throughout the construction industry. Any contractors involved in the construction of shopping centres, industrial buildings, steel composite bridges, sewage treatment plants and other civil engineering works will be particularly vulnerable to these price increases,” Mr O’Sullivan said.

Major supplier Kingspan has warned contractors of price increases from July 1.

The CIF director said the price hike would have a more serious impact on companies who are tied to long term contracts, resulting in companies participating in projects at a significant loss.

A return to more stable conditions is not expected until early 2005.

The CIF is urging the Government, before it hands over the reins of the Presidency of the EU, to demand that China cease its embargo on steel exports in line with its World Trade Organisation agreements.

“This would increase the worldwide supply of raw materials and thereby lead to a reduction and stabilisation in the price,” Mr O’Sullivan added.