The price increase in the construction industry is enormous, it is worth postponing investments

By: Trademagazin Date: 2022. 09. 15. 10:06

The increase in prices in the construction industry was more than double the increase in consumer prices in the first half of this year compared to the same period last year, MTI reports based on the announcement of the National Association of Construction Contractors (ÉVOSZ).

Companies preparing for major investments are in a difficult situation

The drastic price increase affects both construction and renovations. Based on data from the Central Statistical Office (KSH), the trade association found in its analysis that while consumer prices rose by 9.4 percent year-on-year in the first six months of the year, in the same period they rose by 20.4 percent in the building materials industry and by 22 percent in the construction industry’s producer prices. .8 percent price increase.

According to the announcement, companies producing construction raw materials and construction products priced in the market effects of the Russian-Ukrainian war, and contractors priced in procurement difficulties in the first half of the year. The unpredictability of the energy price and changes in the forint/euro exchange rate can also cause further price increases.

Energy price changes are an important factor because energy costs account for an average of 25 percent of the production cost of construction products, but there are construction products (such as cement, fired ceramics, bricks, some insulating materials) where this ratio can be higher. The forint/euro exchange rate can cause a business shock for contractors, as 48 percent of the materials used come from imports.

MTI