Contractors feeling the pinch

PETALING JAYA: Master Builders Association Malaysia (MBAM) affiliate members are feeling the pinch of the escalating costs of essential building materials, including cement and steel bars as well as the recent shortage of sand.

This has led to delayed and abandoned projects in various states. Construction players said the situation had entered a critical stage particularly in Johor, Kedah, Melaka and Negri Sembilan.

MBAM president Ng Kee Leen said the association had urged the government to provide soft loans to small and medium-sized contractors and requested the Construction Industry Development Board (CIDB) to waive the levy on the contract sum of 0.125%, towards aiding its members through these difficult times.

"The local industry is still having problems after the liberalisation process of steel bars," he said at an MBAM dialogue with affiliate members on Aug 1. Ng also hoped that the ban on the import of steel bars would be lifted.

Ng expected more contractors to close shop if the prices of steel bars and cement do not stabilise soon.

Malacca Building Contractor's Association chairman Liw Chong Liong said so far, three major federal government projects in that state had been halted.

Another MBAM affiliate member from Johor said the state was facing a shortage of sand due to the export of the material to Singapore.

National Ready-Mixed Concrete Association of Malaysia (NRMCA) president Chris Landry said sand was an issue, particularly in Selangor and the shortage was due to the government's reluctance to allow sand permits to be handed out.

"Now there is only one sand pit opened for trade which drastically reduces the amount of natural sand available in the market," he said.

Sand is a major component of ready-mixed concrete, and if natural sand does not become more available in the short period, Landry predicted the shortage of ready-mixed concrete would drastically affect the building industry.

Landry said effective Aug 1, sand price had increased by RM7-15 per cubic metre. He added that he had no choice but to increase the prices of concrete as well.