Lack of materials and rising prices impacting Czech road projects
Road construction projects in the Czech Republic are facing problems as builders complain that essential materials are increasingly hard to source, Czech Television reported. What’s more, prices are on the rise.
Road builders say they are having trouble finding materials such as steel and aggregate, thermal insulation, mineral and polystyrene. This is due to the coronavirus crisis and also to a fire at a large plastics factory in the Netherlands.
The prices of orders are not rising yet, but investors and suppliers expect that they will, Czech Television said.
The general director of the national Roads and Motorways Authority, Radek Mátl, says that there is a major problem with the lack of aggregate and steel for concreting and barriers, for instance.
Mr. Mátl told Czech TV that this might represent an even bigger problem than a lack of qualified professionals, such as project architects, engineers and technical supervisors.
A kilogram of steel reinforcement for concrete cost 18 crowns last autumn but today stands at 32 crowns, Zdeněk Pilík, CEO of Plzeň-based construction company Berger Bohemia, told Czech Television.
Mr. Pilík said steel of all kinds was in short supply, while in the case of aggregate only some special varieties were lacking.
Radek Šíma from the Plzeň Region roads administration and maintenance agency said suppliers to the Western ring-road, the region’s biggest road construction project of the modern era, were reporting that reinforcing steel was very scarce and rocketing in price. He said he also expected a rise in cement prices.
Mr. Šíma said the increase in prices is not reflected in contracts for which contracts were concluded last year or at the beginning of 2021.
However, it will naturally leave its mark on contracts that are concluded now, he said; what’s more, the supplier will probably add something extra, as the prices of some materials are rocketing from day to day.
Zdeněk Pilík estimates that new projects will prove up to 30 percent more expensive. The Berger Bohemia chief said his company was turning down deals where the investor rejects a guarantee if there is price movement.
Mr. Pilík said it was impossible to take on all the risk if it was unclear how a project would ultimately turn out.