The price of concrete will increase by 20% on January 1, an industry group has announced.

The Mexican Association of Independent Concrete Producers (AMCI), which represents companies that make 70% of the material nationwide, said in a statement yesterday that a range of factors are behind the price hike.

ACMI president Emanuel García Villarreal pointed to the rising cost of cement and aggregates including sand and limestone as well as higher prices for diesel and electricity.

“This increase . . . is due to the rise in 2018 of all our inputs . . .” he said.

Jorge Pérez, spokesman for Nuevo Léon-based Cemex, the second largest building materials company in the world and a large supplier to independent concrete producers, declined to say when and by how much it would increase its prices for cement.

“Cemex will increase its prices in Mexico according to the inflation of our inputs, which could vary depending on the geographic area,” he said.

However, Javier Fernández, CEO of concrete producer Mecasa, said he had been informed that Cemex’s cement prices would increase by 12% to 13% from January 1.

Cement and diesel contribute to 50% of the overall cost of producing concrete, he explained.

Víctor Salazar, director of real estate development company Clúster de Vivienda de Nuevo León, urged concrete producers to reconsider raising their prices by such a significant amount due to the damage it will cause to the construction sector, which is already confronted with rising costs.

He said that the increase went above inflation and producers’ price indices.

The head of the Nuevo León branch of the National Chamber for Housing Development (Canadevi), Marco Salazar, said “the increase in the price of concrete concerns us but we hope that it doesn’t materialize in a generalized way.”

He added that the exchange rate could be another factor that affects the price of new housing but nevertheless predicted that 50,000 new dwellings will be built in Nuevo León next year.

“We are very hopeful that economic uncertainty won’t increase in 2019,” Salazar said.

According to the National Statistics Agency (Inegi), construction costs rose by 10.23% between January and November, the biggest increase for the same period over the past decade.

Cement prices increased between 3% and 9.9% in the first nine months of the year, depending on the supplier, but respective 30% and 28% increases in the cost of steel and wire rods have contributed even more to rising building costs.

Source: Reforma (sp), El Financiero (sp)