Construction stalls as prices of cement, iron sheets shoot up

The construction industry is facing a sharp slowdown following a steep rise in the prices of construction materials such as cement, iron bars, bricks, and sand.

Monitor understands that the prices have been rising since the start of the year, eating into the budgets of business owners and property developers and in some instances, causing construction of some projects to stall.

For example in Greater Masaka, the price of a bag of cement has risen from Shs32,000 to Shs38,000, an iron bar now costs Shs31,000, up from Shs25,000, while a kilogramme of nails is currently sold at Shs8,000, up from Shs6,000.

A trip of sand (Isuzu Elf) has increased from Shs50,000 to Shs80,000 whereas that of bricks, which cost  Shs100,000 in January, currently sells at Shs150,000.

Mr Abbey Ssemanda, a salesman at Edema Hardware in Luweero, said a bag of cement currently costs between Shs33,000 and Shs36,000, depending on the brand.

“Our prices are dictated by the cement manufacturers. For some time now, the prices for the different building materials have slightly gone up,” he said.

Mr Abdul Nsubuga, a sales manager at Ssembajwe hardware shop located in Wobulenzi Town, revealed that the cost of building materials started increasing three weeks ago.

“A bag of Hima cement currently costs Shs48,000 while Tororo cement costs Shs36,000. We sell the white cement at Shs75,000.  The prices of other construction materials have equally gone up during March,” he said.
 Mr Fredrick Mayanja, the proprietor of Hida Hardware in Kalisizo Town, Kyotera District, blamed the prices of bricks and sand on heavy rains in January.

“It is obvious that it has been heavily raining here since January, which affected the making of bricks and mining of sand,” he said.

In Tororo, several construction sites in the municipality have stalled following an increase in prices for building materials.

For instance, at Ambassador Hardware Shop in Tororo Town, a bag of Tororo Cement Cement is being sold at Shs32,000 from Shs30,000, Iron bars Y12 is being sold at 38,000 from Shs34,000 while Y10 costs Shs48,000 from Shs44,000.

Mr Bernard Obonyo, the proprietor of Ambassador Hardware Shop, blamed the rising prices on low production.

“For example, Cem 2 of Tororo Cement has not been in circulation after the plant halted production over unknown reasons,” he said.

However, the Chief Executive Officer of Tororo Cement Industries, Mr Morgan Gagrani, told Daily Monitor that they have resumed production of all building materials.

“We had only halted production because the mill was under maintenance but now all products are available,” he said.

In the island district of Kalangala, it has been a practice by hardware owners to increase the price of cement by Shs1,000 per bag to cater for transport costs.

Ms Suzan Namubiru, the proprietor of Friends Hardware in Kalangala Town Council, said a bag of cement sells at 37,000 (Tororo cement) from Shs32,000 and Shs36,000 (Hima cement) from Shs32,000.

A kilogramme of roofing nails goes for Shs6,000 from Shs4,500, iron sheets (gauge 32) are sold at Shs30,000 each while for iron bars, the price ranges between Shs34,000 and Shs44,000, depending on the size.

“When we go to buy the materials from big distributors in Masaka, they sell at high prices, which force us to raise the prices,” she said, adding the wholesalers informed her that the increase in prices is as a result of the US Dollar gaining more value against the Shilling.

In Buikwe District, Mr David Aniku, a builder, said there is a scarcity of cement in the market.
“Move around some building sites and you find that they have put construction on hold because of the high prices of cement. The sellers have old stock that they want to make profits from before the next financial year,” he said.

According to Mr Aniku, a bag of cement, which was costing Shs29,000, now costs Shs35,000.
In Kamuli District, prices of cement have increased from Shs31,000 to Shs35,000 per bag.

Mr Isma Kisozi, a hardware sales officer in Kamuli Town, said despite the rise in prices, the consumption is surprisingly higher, with many customers hurrying to buy and stock as they anticipate the prices to soar further.

Mr Paul Zirimenya, a contractor, said the high prices of cement have affected their profit margins.

“When the price shoots up, it eats part of our profits and we are in a hurry to complete some of the construction sites before the prices rise further,” he said.

Some builders in Mbale said inflated material costs are a bad sign for the economy.
“This will impact rental fees in the long run, ”Mr Sam Mafabi, an engineer, working on several construction projects in Mbale, said.

A bag of Tororo Cement in Mbale City is being sold at Shs33,000 from Shs30,000. Simba cement has increased to Shs31,000 from Shs30,000, Iron bars Y12 is being sold at 38,000 from Shs34,000 while Y10 costs Shs48,000 from Shs44,000.

In Gulu, the chairperson of the Construction Hardware and Dealers Association (CHADA), Mr Abbas Mutyaba, said the rise in prices of construction materials is not about to stop due to unstable fuel prices and unfair markets across the East African region.

“We are experiencing a slowdown in sales and an increase in prices since the fuel prices are going up,” he said.

Mr Gilbert Bongomin, a civil engineer, said a bag of Tororo cement rose from Shs33,000 to Shs35,000.
“The same with Simba cement, and this impedes efforts of individuals who are coming up with their various construction projects,” Mr Bongomin said.

He said they have been forced to suspend works on a Shs71 million construction project since the owner experienced an inflated budget due to the increased prices of raw materials.

At major hardware stores in Gulu sampled by this newspaper, cement prices range between Shs33,000 and Shs35,000.

In Arua City, a bag of cement now costs between Shs45,000 and Shs46,000, from Shs 40,000, two months ago. 

According to a builder, Mr Ali Anguyo, the rise is due to the high costs.
“The wholesalers told us that they are buying from suppliers expensively. So, the cost of transportation from Tororo has made them hike the price,” he said. 

Ms Josephine Asina, a resident of Pajulu Trading Centre who is carrying out construction of a residential house, said: “I have stopped building my house at slab level to pave way for the wall to be built. Now, I cannot afford a bag of cement at Shs46,000,” she said.

Ms Asina said she is looking at the option of using mud mortar to construct the walls to cut costs. “I am not sure if our children will build decent houses in the future if prices keep going up like this,” she added. 

In Kabale, the proprietor of Macro Hardware, Mr Joram Bwambale, said the increased cost of building materials has scared away many customers. He added that his suppliers have attributed the increased cost to the inflation and also high taxes imposed on manufacturers.

The prices of Tororo cement and Hima cement have increased from Shs33,000 to Shs34,000 and Shs32,500 to Shs34,000, respectively.

The price of ordinary iron sheets has increased from Shs27,000 to Shs29,000 while the corrugated ones have increased from Shs47,000 to Shs48,000. The price of iron bars has increased from Shs36,000 to Shs38,500 each.

“This price increase has not only scared away most of our daily customers but also affected our daily income yet we have to continue paying workers, local taxes and rent for the premises where we are operating from,” Mr Bwambale said.

In Bundibugyo Town Council, Mr Jerome Masereka, said the price for every construction material has risen, forcing him to abandon construction.

The cost of roofing nails has risen from Shs7,000 to Shs8,000 per kilogramme, and a bag of cement is now priced at Shs35,000, up from Shs34,000.

“The government should intervene, otherwise, the situation is going out of hand,” Mr Moses Mibiri, a resident of Bundibugyo Town Council, said.

In Masindi Town, Mr Jimmy Tumusiime, who operates a hardware store, said the price of Hima cement had risen from Shs35,000 to Shs37,000, and multi-purpose cement from Shs31,000 to Shs34,000 per bag.

“The cost of iron sheets witnessed a significant uptick, with a single sheet (white) of 1.2 inches escalating from Shs54,000 to Shs60,000, and the same type of iron sheet at 1.5 inches increased from Shs64,000 to Shs74,000,” he said.

What they say

Joram Bwambale, hardware owner: “This price increase has not only scared away most of our daily customers but also affected our daily income, yet we have to continue paying workers, local taxes and rent for the premises where we are operating from.”

Josephine Asina, resident of Pajulu Trading Centre: “I have stopped building my house at slab level to pave way for the wall to be built. Now, I cannot afford a bag of cement at Shs46,000.” 

Paul Zirimenya, contractor: “When the price shoots up, it eats part of our profits, and we are in a hurry to complete some of the construction sites before the prices rise further.”

*Compiled by Fred Wambede, Al –Mahdi Ssenkabirwa , Dan Wandera, Richard Kyanjo, David Sekayinga,  Philip Wafula, Denis Edema, Sam Caleb, Bill Oketch, Tobbis Jolly Owiny, Felix Warom Okello and Clement Aluma, Robert Muhereza, Emmanuel Arineitwe, Ismail Bategeka, Longino Muhindo and Susan Nanjala