Concrete shortages unlikely to ease off
There will still be shortages in concrete supply in the UAE next year because of rising demand, according to Abdel Razzak Dajani, general manager, Xtra Mix Concrete.
There will still be shortages in concrete supply in the UAE next year because of rising demand, according to Abdel Razzak Dajani, general manager, Xtra Mix Concrete. Some experts had predicted there would be a glut of cement - the main component used to make concrete - on the market by next year.
But Dajani claimed that the huge number of building projects in the UAE would make it difficult for contractors to acquire adequate concrete supplies.
He gave delegates at last week's Construction Week conference a list of statistics which explained why supply was outstripping demand. Concrete accounts for 75% of the commercial structure's costs and 30% of the whole commercial costs. In 2001, UAE consumption of locally-produced cement was at six million tonnes.
In 2006, it had risen to 13 million tonnes, and is expected to hit 14 million tonnes this year.
Meanwhile, in the same period concrete production rose from 11.2 million mÃƒâ€šÃ‚Â³ to 28 million mÃƒâ€šÃ‚Â³.
The price of concrete has risen from US $49 (AED180) per mÃƒâ€šÃ‚Â³ in 2000 to around $72.2 in 2007.
The average worldwide consumption of concrete per head of population per year is 300kg.
In GCC countries it is 1100kg, whereas in the UAE it is 3000kg.
Dajani said he expected the consumption of cement to increase by about 15% in 2008.
"Of course, what will happen is that we will go back to the ÃƒÂ¢Ã¢â€šÂ¬Ã‹Å“cat and mouse' game between supply and the customers' needs," he said.
"We do expect there will be a shortage next year because the cement that is forecast to go online as excess cement will not go online until the end of 2008 or 2009. Because there will be shortage of cement it will reflect on the shortage of concrete."
Dajani added that there were measures contractors could take to help keep a constant supply of concrete. He said they should give better notice to suppliers, sign long-term contracts, and also have two or three suppliers. Xtra Mix Concrete, a member of the Al Jaber Group, has eight plants and 500 employees.