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| China-Japan-Koreas |
| Cement shortage hits home in California as China sponges up available supply |
| 2004-07-09 |
| The raw material that serves as the foundation of the construction industry is in short supply, consequently pushing up prices. Cement, made of burned lime and clay and mixed with water and sand, is a hot commodity these days partly because of low cement inventories. "We’re scrambling around to our suppliers hoping to get the concrete that we need," said John Young, president of Young Homes, which has 700 houses under construction in the region. "If you can’t get your concrete work done, everything else has to stop." The reason for the shortage? China is experiencing a surge in its economic growth and has increased demands for cement, as well as steel,lumber and other dry bulk products, which has resulted in a shortfall of ships carrying products to the United States from Asia and Europe. Their demand for cement is seven times that of the United States. And construction projects are underway all over California. "Construction is stronger (in California) than anticipated. We went into spring with lower inventories than (usual) and have not been able to play catch up," said Jim Repman, president and chief executive officer of Glendora-based California Portland Cement. Repman said by October, the demand for cement should wane as the construction season ends. Cement shortages are hitting 23 states in the Southeast, the Southwest and the New York/New England regions. Those states accounted for 48 percent of the total U.S. cement consumption during 2003, according to the Portland Cement Association. Canada is the largest importer of cement to this country. Local builders and concrete suppliers are hoping for the best, but worry an extended shortage could delay hundreds of projects and cost millions of dollars. "We have to take a certain amount of orders, then we close order-taking," said Mike Gatherer, owner of Irwindale-based B & B Red-I-Mix Concrete. "We are a six-day operation. Sometimes on Saturday we can’t get the supply, so we close." Gatherer said he experienced a rate hike in April and July 1, and expects the next one Sept. 1. "It’s about a 5 percent increase each time," he added. Stella Campos, an office manager with Dominguez Construction in Azusa, said the cement shortage is not only an inconvenience, but worrisome. She said she’s never seen shortages like this in the 24 years she’s been in the construction industry. "We have to order way ahead of time. We can’t just call today like we used to be able to do, because (suppliers) want a week’s notice," Campos said. "It’s a concern that there won’t be any cement, and it will be harder to get. It’s not like we can stockpile it." |
| Posted by:Mark Espinola |
| #1 same thing nationwide in steel (specialty architectural, rebar, structural ASTM A36). We have to include escalating item pay/costs specs to help contractors cover the increases over 6+ month contracts.... |
| Posted by: Frank G 2004-07-09 7:59:03 PM |