The construction business is a vital part of the country, and it is a booming business. Thanks to it, we have places to stay, work, drive in, and even have fun. The beautiful skyscrapers and construction structures are all there thanks to the industry. Some structures such as bridges have been in existence for quite a long time now, spanning waterways, dryland depressions, over other roads, and even the railroads.
However, there is a problem facing the industry threatening its functioning and operations; shortage of cement. The cement available for construction is not meeting the demands of the market. The industry has been heavily hit by the recent happenings where contractors and domestic retailers have to endure steep price rises due to concrete shortages. So is it safe to ask; is there a concrete shortage?
It is no secret that concrete is a widely used construction material, a backbone of the construction industry. It is durable, strong, affordable, and versatile. However, the booming business faces a scarcity problem, which means that the industry must rethink solutions before the situation gets out of hand.
What are the several factors that have contributed to this concrete shortage in 2021?
Several factors have contributed to the industry's inability to maintain a continuous flow of materials and services from one location to another. For example, 2020 was heavily hit by the pandemic. The supply of materials from one place to another, as well as those coming from other countries, was nearly paralyzed. This means that all the logistics operations had to adjust accordingly to maintain supply while at the same time abiding by the Covid 19 restrictions.
Still, on the pandemic, factories and industries that manufacture cement were also affected by the pandemic and its restrictions. For example, the raw materials take longer to reach the manufacturing plants. Additionally, these plants had to develop strategies that would ensure continuous cement production while still following the government guidelines of social distancing. Some of them even had to downsize to still stay functional throughout these trying times. All these contribute to a slower production process meaning that they could not produce as much cement as previously used to.
Remember that since the less production of cement does not decrease the demand for the commodity, constructions still had to go on. Therefore, the running projects are left to share the available cement, diminishing the supply.
Such disruptions have greatly affected the distribution channels, from manufacturing to delivery.
The world's population, just as expected, is growing at a rate that has made the demand for housing exceed the supply of building material supplies, concrete being one of them. An increase in population will mean that more houses, facilities, and other structures contributing to the general infrastructure have to be erected to manage every person's needs and requirements.
The supply of cement from the manufacturers seems not to be able to keep up with this demand. This causes delays in several construction operations, such as real estate projects.
The country is a beehive of activity when it comes to improving the infrastructure. Some of these projects are average and manageable using the available resources—however, others, such as the stadiums and bridges, consume vast amounts of building material. Cement is the main ingredient of the materials, along with other aggregates is therefore consumed in heavy amounts. It does not have a replacement in the process; it has to be there.
Due to such projects, tons of truckloads of mixed concrete hit the road every now and then, heading to the construction sites. When a single project consumes that much cement, it causes a shortage that leaves the rest of the projects scrambling for the few remaining supply.
In fact, some distributors are being faced with the challenge of dealing with their customers. It even reaches a point where they have to choose which customers get the cement supply and which ones get cut back.
With the national cement shortage being projected to increase further, industry experts have raised their concerns concerning the issues, appealing to the responsible government bodies to find solutions to this problem. This is because if the trend is left unchecked, serious consequences are going to hit the industry.
It is essential to come up with solutions to concrete shortages and what to do about them. What can be done to solve this issue?
Below are some of the things these experts have highlighted.
One of the effects of the concrete supply issues in 2021 is the price rise. Since getting the commodity has become a challenge, the costs of obtaining it from the suppliers with ready stock are definitely high. However, the government can decide to collaborate with private investors and stakeholders of the industry prepared to import additional cement and supply it to the consumers, increasing the supply of the commodity available in the market.
Since the government controls importing operations, taxing systems, and other related processes, it can devise a strategy or policy that allows these importers to import cement at affordable fees. Why?
All these additional costs and expenses will dictate the final price of the product. Therefore, if the tax duties and transportation fees are high, the final price tag of cement will be high too.
This means that for the supply of cement to increase and the price to remain the same, the government has to ensure that these sites work to the advantage of the industry.
Additionally, the industries in the private sector should also be willing to cut back on their profit margins if the industry is to survive. This might be a tough call for them since they are in business to make money, but on the other hand, they should consider the fact that in case the industry comes to a halt due to this shortage, they will be among the first parties in the line to suffer the consequences.
The price hike of cement is such a concern for the industry. Why? Because when these prices increase, many construction projects, including government projects, will be heavily hit. Some of these projects are already running on tight budgets; adding additional costs will only add insult to injury.
The construction industry should adopt a "conservation "policy for the available cement. This means that if there is a project that requires the use of cement, the relevant authorities have first to evaluate and figure out whether other materials can be used in place of the cement. This will ensure that the available amount is utilized only in projects that actually require it.
Pulverized Fuel Ash (PFA). This is a by-product produced in coal-burning power stations. The material is even used together in Portland Cement. However, it can also be used as a substitute for cement entirely since it also relies on lime and water for the overall chemical reaction necessary in construction.
Ground Granulated Blast Furnace Slag (GGBS), another by-product of industrial processes. It is produced from the iron and steel industries and is chemically similar to cement. Even though it is less reactive than cement, it can still be used in construction effectively and get the job done. It sets a little slower than regular cement, gradually strengthening the structure and improving the overall quality and durability.
Limestone fines. They have been used for quite some time now as a replacement for cement. It is used as an ingredient in making lime cement. It can also be mixed the small amounts of cement and efficiently be used in construction. When being combined with cement, the proportions mainly used is a 10%-20% mass of the total requirement.
Silica fumes. They are formed as a by-product of silicon manufacture. The resulting powder comprises of very fine particles that can even be blown away like smoke. It can perfectly replace cement in construction processes, especially when modified into denser or slurry forms. However, economic considerations regulate the use of silica fumes only to high strength concretes, especially when it has to be used in aggressive environments.
Is there a shortage of cement? The general answer to this question is yes. Cement producers and the construction industry are being faced with the problem of failing to meet the market demand of a very vital product in the construction industry. Experts and professionals are claiming that this problem is likely to get worse before it gets better. The market might actually fluctuate, causing a crash. It is, therefore, up to every stakeholder in the construction industry to come up with better strategies if solving the problem. Institutions such as Equify Financial are even ready to offer financial support to companies that need help boost production to balance the demand and the supply. The industry is an important part, and it should be treated as such.
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