The leap in material costs (up to 30% ) caused by the war in the Middle East is putting a strain on Sardinian companies in the building and construction sector , to the point that many public and private jobs could be at risk.
Confartigianato Sardegna has raised the alarm in a report analyzing the changes in the prices of raw materials, semi-finished products, and finished products since the beginning of the conflict.
«The entrepreneurs of the sector – states Confartigianato – find themselves in a “perfect storm” in which there is the cost of raw materials, semi-finished products and products, the poor availability of
these, the difficulty of transport and the need to update
continuously price lists and estimates to avoid losing orders and jobs."
"There are fears," explains President Giacomo Meloni , "that the instability in prices, from raw materials to energy to diesel, could impact both public works and private sector projects, and the devastating consequences of this situation could be difficult to bear, especially for small and medium-sized businesses."
Analyses by the Research Office of Confartigianato Sardegna estimate that there are nearly 20,000 micro and small manufacturing and construction businesses active on the island, employing nearly 54,000 workers. These businesses are affected by a shock to the higher costs of raw materials , which, on an annual basis, is worth around half a billion euros, equal to 1.7% of the regional GDP.
The Artisan Association of Sardinia, collecting data on
Pre- and post-Iran crisis purchase invoices from some of its members, notes how some materials are already showing significant price increases.
The general increase in prices varies between 10% and 15% with peaks of 30%.
Here are the average increases already recorded and announced since April 1st: products
construction chemicals +3%; plasterboard and plasters +3.5%; sands,
binders, mortars, concretes and garden furniture, cement products +
5%, internal and external paints, external insulation system, enamels and
impregnants + 6.5%; polyethylene pipes and fittings and construction site nets
+10%; bituminous membranes +10%; extruded polystyrene, glass wool, and mineral wool; PE containers for drinking water storage +13%; insulation and waterproofing products between 7% and 15%; PVC and polyethylene pipes +20%; smooth polyethylene pipes and multilayer pipes +30%. The increase in concrete tiles and tiles is yet to be quantified. A 15% increase is expected for concrete. Iron prices also saw increases, in some cases reaching +20%.
"If this trend were to continue," Confartigianato emphasizes, "the real risk would be a slowdown or halt in public construction sites and a difficulty in implementing planned interventions in the area. Without effective adjustment mechanisms, the risk is that the balance of contracts could be compromised and the execution of projects would be slowed down."
To address this scenario, Confartigianato "believes it is essential, within tender notices, to apply price review clauses and material compensation for public works , as required by the Public Procurement Code, to counteract cost increases and offset the increased costs of companies, thus ensuring economic balance in contracts and protecting the companies involved in carrying out the work."
Furthermore, concludes President Meloni, «it would be appropriate,
Institutions are urgently calling for the activation of monitoring tables dedicated to the trend in construction materials prices, also to prevent possible distortions due to speculation."
(Unioneonline/lf)
