Prices of building materials down by 61.3%

Statistics Center – Abu Dhabi (SCAD) issued today its monthly building materials prices index, for the month of June.

The statistical release is coming in line with SCAD active contribution to support the development vision of the emirate of Abu Dhabi, as well reflecting the Center’s keen interest and commitment to produce relevant vital statistics that provide solutions ‘&’ development to help raise ‘&’ elevate awareness within the overall business community and among the public at large about building materials price levels; in order to avoid conflict ‘&’ discrepancies that might arise from differences in pricing, as well as to limit manipulation in the prices that may be caused by some traders.

It is worth mentioning that SCAD’s monthly bulletin on building materials measures average prices on the basis of a list that contain 138 items constituting 90% of the primary and basic materials used in the overall construction process, hence the bulletin plays an instrumental role in the statistical data availability to decision-makers and the various business users, including governmental entities, private companies and the business community at large.

The index shows that the building materials sector had been very volatile over the past few months, with noticeable prices variations, where prices decline as a result of the global economical crisis facing the world at large.

Comparing the average prices for the month of May and June (2009), a drop were recorded by 61.3% in the items that were used to produce the index, while the remaining items rose up slightly in the average. Sulphate resistant cement (Itihad) for example dipped on average between (3.4 – 4.1%)/ ton, while the white cement (Emarat) rose up on average of 2.5% from AED 559.4/ton in May to AED 573.1/ton in June.

On the other hand, the prices of the construction steel from different sources were fluctuating in general, as the average price of steel/ton have drifted lower relative to its origin by (1.8 – 7.4)% against their average prices during May 2009, as well the flat steel (Turkey) slipped 7.5% over the recorded price in May 2009, from AED 2425 per ton in May to AED 2243 in June 2009 on average. Likewise, Turkish beam steel (6-8 mm) fell by 10.3% over the same time span.

With the exception of the Qatari high tensile steel, which went up slightly by 3.2% from the average recorded on May 2009, the prices of the Emarati ‘&’ Turkish high tensile steel reflected the same trend as the bulletin shows a drop of (1- 1.2)% compared to their average prices last May. SCAD’s report also shows a drop of 10.4% in the price of the Chinese made binding wire (10 kg/bundle) , as well the average prices of hollow concrete block slipped (3.2 – 9.3%) from their May 2009 levels.

Over the reference period, the prices of the UAE made B.R.C. Mesh 7 and 8 mm edged up (2.9-5.4%) on average, while the price of the 6mm size mesh dipped by 2%.
Finally, the index points to a marked decrease in the average prices of cement ranging between (2.4 – 17.6%) against their prices during last month. Some vendors have attributed this decline to a rise in domestic production, and the discontinuation of some projects due to the global financial crisis.

In this regard, Statistics Center – Abu Dhabi asserts that the building materials market is experiencing high volatility for reasons related to the global financial crisis and its impact over international markets as well as in response to the supply and demand mechanism.