Industry to be hit with 16% cement price hike


Concrete being poured at construction site

Cement producers are planning to hike prices by £15 a tonne blaming high energy costs for the biggest single increase in decades. The big industry-wide hike amounts to around a 16% jump and will come into force at the end of this year. It threatens to send a shock wave through construction taking the annual rise to an unprecedented 30% over the year. One contractor warned: “This is going to hit everybody but also major projects very hard. A jump like this will impact planned spending on Government projects.” A precast user said: “The shocking thing is we are being told that there is no point in trying another supplier because all the key producers are putting up prices by similar amounts. We’re being told it’s basically non-negotiable. “The industry is used to 3% and 5% increases but this is unprecedented. Taking into account rises already this year it will mean cement has soared 30% on a year.” He added: “It seems it is going up across the board whether you take 30t, 300t or 3,000t a year” Another firm told the Enquirer: “We have done a ring round and it seems all the producers are going for the same rise. “Five months ago all the big producers were putting us on allocation after seemingly all shutting down kilns around the same time for maintenance. “Now the industry is being hit with this major price rise. It mirrors what happened around 30 years ago.” He added: “We warned the producers it was short-sighted just passing on extra costs. “As a business, we try to absorb a proportion of cost increases, by finding savings from growth and cost efficiencies. You can’t just pass it all on down the supply chain without it having a huge impact. “It’s going to push people away from cement to cement-free alternatives. These cost around £150 a tonne but the gap is closing now that cement is breaking through a £100 a tonne.”

 

Source: Construction Enquirer

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