Demand for building materials rising

The demand for building materials has recently started picking up after a virtually standstill due to the covid-19 pandemic.

Sector insiders attributed the good sign to resumption of construction activities in the country and the almost stable prices of key materials like steel rod, cement, bricks and sand since the beginning of this year mainly because of sluggish demand.

Usually, the demand falls in monsoon, they said, adding that the situation has worsened in the recent times against the backdrop of the pandemic and ongoing flood situation.

Currently, per tonne of best quality or 72-grade standard rod is selling between Tk 55,000 and Tk 60,000 depending on manufacturers, a trader in the old Dhaka told the FE.

"There are notable differences in quality of 72-grade rods depending on the manufacturers though the materials are standardised similarly," said Mr. Tanim Ahmed, proprietor of Dewan Traders.

The price of the same went as high as Tk 70,000 per tonne during the post-budget period in July last year (2019), he said, adding that since then the price continued to decline and remains somewhat stable at some point till date.

He also said that another quality or 60-grade steel rod's price was ranging between Tk 47,000 and Tk 50,000 depending on the manufacturers.

According to the sources, the widely used steel rod brands in Bangladesh include AKS, BSRM, GPH, RSRM, KSRM and BSI.

According to the Trading Corporation of Bangladesh (TCB) market monitoring data, the price of 60-grade steel rod ranged between Tk 58,000 and 61,000 on Sunday which were between Tk 67,000 and Tk 70,000 a year ago.

Contacted, Tapan Sengupta, deputy managing director of Bangladesh Steel Re-rolling Mills (BSRM), said the market has been stable though the price of scarp metals has been showing a rising trend in the recent weeks due to the pandemic.

"Currently, per tonne of scrap metals is selling between US$310 and $340 varying on standard which was below $300 weeks ago," he said.

Though Bangladeshi steel makers are capable of meeting all the domestic demands, the country is fully dependent on imported metals, he added. "That's why the market fluctuates in tune with the global outlook."

Besides steel rod, cement is another important ingredient of structures. The price of a 50-kg bag cement has also been remaining stable after a sudden hike in 2019's post-budget period.

"Currently, we are selling per bag of cement at Tk 400-440 varying from one manufacturer to others," said Wahid Uz Zaman, a dealer in the city's green road.

People are now investing less on construction works, considering the disruptions in economic activities caused by the coronavirus pandemic, he said." Our sales volume has dropped to one-third than that of the pre-pandemic period."

The most common cement brands include Bashundhara, Fresh, Shah, Scan, Akij and Premiere, sources said.

The prices of two other basic materials like brick and sand have remained stable for more than a year, they added.

Iman Mia, a manager of brick traders in the city's Gabtoli BaluGhat, said the best quality a truck-load or 3,000 pieces of bricks is selling at Tk 25,000.

Other low grade bricks at similar unit cost between Tk 17,000 and Tk 20,000, he said, adding that the buyers will have to bear the transportation cost in addition to the price.

Select sand per 200-cubic feet or a truck-load now costs between Tk 8,000 and Tk 10,000.

The stability in materials' price has been beneficial for the business entities which were continuing their construction works despite the pandemic.

Welcoming the situation, real estate sector's trade body leader Kamal Mahmud said that such stability in prices is much needed to operate their business.

"Now many construction sites have resumed activities as realtors need to hand over the properties in time," he said.

Mr. Mahmud, who is a director of the Real Estate and Housing Association of Bangladesh (REHAB), said: "Stability in the building materials' prices is a must for any construction sector especially the real estate as many parties take part in the agreement."

He also underscored the need for framing a government policy regarding pricing if the construction materials. "Abrupt changes often jeopardise the developers not only in the private sector, but also the government sector developers."

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