The constructions market is going to advance by around 20-30% this year, to around 12-13bn euros, without being hindered by the bad weather registered at the start of the year.
Construction materials prices, however, will go up by at least 10-15%, indirectly influenced by rising energy and oil prices.
Despite the price hike, consumption will remain high despite the bad weather that did not allow for construction works to proceed.
"(...) From our estimates, snow and the low temperatures will have an impact of less than 1% on the growth of the constructions market this year," stated Laurentiu Plosceanu, chairman of the Romanian Association of Construction Contractors (ARACO). According to him, the growth rate of around 34% to some 10bn euros the market posted in 2007, will remain in history, though, with a similar level hard to reach in the following period.
"(...) The growth pace will be similar to that of 2007 owing to real estate investments, particularly in shopping centres, logistic parks, office space and industrial projects," stated Valentin Visoiu, general manager of Pitesti-based Conarg company.
The main growth drivers for the constructions market are structural funds and the favourable conditions generated by 2008 being an electoral year.
"(...) However, the trend of the market will depend on the way the workforce shortage is covered and the absorption of structural funds," explains Plosceanu. Oil prices increase above 100 dollars and the gas price hike by at least 30%, as well as RON falling against the euro will have an indirect influence over prices of constructions materials, set to witness gradual increases this year.
One of the hardest hit industries will be that of cement, with prices set to rise by at least 10%.
"Cement prices are indirectly influenced by oil price increases. Oil products, as well as coal and diesel oil have an impact over the cement industry. As a result, we estimate we'll see production costs increase by 5-8%," said Mihai Rohan, general manager of Carpatcement Holding.
Yet, the most important issue for cement producers is now the trend of the exchange rate, from the perspective of imports of energy, equipment and spare parts for installations. At the same time, taxes and royalties for raw material exploitation could also lead to an increase of around 0.5 euros per tonne.
"Another factor that may have an impact on cement prices this year is represented by carbon dioxide allotments, in case they are not sufficient and we'll have to buy from the free market. (...)," explains Rohan.
Holcim is dealing with the same problems and will increase the price of the products it sells on the Romanian market.
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