Shortages To Keep Building Costs Soaring Pros Say
By Claudio Mendonca
Shortage of roofing tiles, cement and aggregates as high-rise construction intensifies will escalate building prices about 17% this year, industry professionals say, with tile orders backlogged all year.
Roofers now face a six-month wait for materials, said Danny Cruz, managing partner of R&R Roofing Inc. in South Miami. He blames hurricanes Katrina, Rita and Wilma, which intensified demand.
Heavy shipments of US-made tiles and a rise in imports have been done to meet demand, he said, but with imports, logistics cause constant delays.
"Right now, everybody is backlogged," said Mr. Cruz, who said he hears from suppliers that the average rise in material costs will be around 17% this year.
Michael Levine, president of Murton Roofing Inc., said the shortage is only slightly improved from last summer.
"We have a very fluctuating market right now," he said. "We still have delivery delays, but there is more importation from other countries and other states. We have been receiving materials from the Midwest such as Illinois, the Dakotas – in other words, areas that are slow" for construction work.
As more companies enter the business and foreign producers ramp up, Mr. Levine said, production will grow by year-end. "We are about a year away of having supply catching up with demand."
Cement might also fall short due to massive building. Jose Cancio, president of concrete producer Supermix, said the industry will have about a 5% jump in sales this year.
Mr. Cancio said sales forecasts for 2006-07 depend on three factors – the strength of the US economy, global political stability and interest rates. He said it is important that economies in South America remain strong, bringing a strong flow of capital into the region.
"This is going to be a strong year for the industry," he said, and demand will remain high until 2007. "We have been fortunate that Florida is going through a strong economic period."