Construction Material Price Trends

advertisement

Presentation to

Italian Delegation Visit to Singapore

Mr Ho Kong Mo

Joint Managing Director

Langdon & Seah Singapore Pte Ltd

11 December 2013

Global Construction Consultants

Agenda

• Brief Introduction of Langdon & Seah

• Construction Market in Singapore

– Construction Activity / Demand

– Categorization of Consultants and Contractors in Singapore

– Basic Materials Price Trends

– Tender Price Index (TPI)

– Upcoming Developments…

• Q & A?

BRIEF INTRODUCTION OF

LANGDON & SEAH

Global Construction Consultants

Langdon & Seah is a multi disciplinary firm of client focused specialists, highly experienced in all areas of the built environment, with an in-depth knowledge of procurement, development, finance and construction delivery processes. We are committed to representing the Client’s interest and managing their risk without compromise.

4

LANGDON & SEAH IN ASIA

Total of 36 offices and

3,000 + staff

Brunei > Bandar Seri Begawan

China > Hong Kong, Beijing, Chengdu, Chongqing,

Dalian, Foshan, Guangzhou, Hangzhou, Macau,

Sanya, Shanghai, Shenyang, Shenzhen, Suzhou,

Tianjin and Wuhan

India > Bangalore, Chennai, Delhi, Hyderabad,

Mumbai and Pune

Indonesia > Jakarta, Bali and Surabaya

Korea > Seoul

Malaysia > Selangor, Johor, Penang and Sabah

Philippines > Manila

Singapore

Thailand > Bangkok

Vietnam > Hanoi and Ho Chi Minh City

5

As of April 2012, Langdon & Seah (L&S) has merged with ARCADIS which has an extensive international network and 21,000 Employees worldwide.

ARCADIS also have within the group, EC Harris, a renowned and leading global

Built Asset Consultancy.

Construction Activity / Demand

Global Construction Consultants

Construction Activity / Demand

40.0

36.0

32.0

28.0

24.0

$24.0bn

$24.5bn

$35.7bn

$22.5bn

$27.6bn

2013f

$35.5bn

$28bn to

$34bn

$30.7bn

20.0

16.0

12.0

8.0

4.0

$16.3bn

$18.3bn

$15.3bn

$12.7bn $13.3bn

$14.1bn $14.5bn

$10bn

$16.8bn

$11.5bn

$10.3bn

0.0

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012p 2013f

Private Sector Public Sector Total Value

Year

Private Sector

Public Sector

Total Value

1995

8.3

8.0

16.3

1996

9.7

8.6

18.3

1997

12.7

11.3

24.0

1998

5.9

9.4

15.3

1999

6.7

6.0

12.7

2000

8.1

5.2

13.3

2001

7.0

7.1

14.1

2002

4.8

9.6

14.5

2003

4.6

5.4

10.0

2004

5.7

4.6

10.3

2005

7.5

4.0

11.5

2006

13.1

3.7

16.8

Source: BCA as at 3 September 2013

2007

18.8

5.7

24.5

2008

20.2

15.5

35.7

2009

8.6

13.9

22.5

2010

19.0

8.6

27.6

2011 2012p

20.2

15.3

35.5

2013f

21.2 15-18.5

9.5 13-15.5

30.7

28-34

8

Construction Activity / Demand

Breakdown of Construction Demand 2013

Public / Private Sector

Public Sector

$13 - $15.5bn

(46%)

Private Sector

$15 - $18.5bn

(54%)

Private Sector

Source: BCA as at 3 September 2013

Public Sector

9

Construction Activity / Demand

Breakdown for 2013

(By Type of Work)

Civil

Engineering

21.4%

Public

Residential

18.9%

Institutional

& Others

13.6%

$28 bn to

$34 bn

Private

Residential

23.2%

Industrial

11.8%

Source: BCA as at 3 September 2013

Commercial

11.1%

10

Construction Activity / Demand

Forecast for 2014-2015

2014 – 2015#

Forecast

(Average Annual)

Total for Both

Public and Private Sectors

S$22 billion to S$30 billion

Source: BCA as at 3 September 2013

11

Categorization of Consultants and

Contractors in Singapore

Global Construction Consultants

Public Sector Panels of Consultants (PSPC)

• The Public Sector Panels of Consultants (PSPC) is to facilitate the Government in appointing consultants to undertake building development projects.

• It lists companies that provide consultancy services for public sector building and construction projects, categorized by different disciplines and different project cost range.

• PSPC Disciplines c/o:

– Architects (Arch)

– Civil / Structural (CS) Engineers

– Mechanical & Electrical (M&E) Engineers

– Quantity Surveyors (QS)

– Project Managers (PM)

Public Sector Panels of Consultants (PSPC)

• Tendering Limits for PSPC Panel Firms as follows:

– Arch, CS Engineers, M&E Engineers and QS Disciplines

Tendering Limits (S$ million)

1 Jul 2013 – 30 Jun 2014

Panel 1

13 to 85

Panel 2

4 to 40

Panel 3

Up to 13

Panel 4

Up to 4

– PM Discipline

1 Jul 2013 – 30 Jun 2014

Panel 1

Tendering Limits (S$ million)

Panel 2 Panel 3 Panel 4

>30 >10 to 65 Up to 30 Up to 10

• More information can be viewed at www.bca.gov.sg

Public Sector Panels of Consultants (PSPC)

• Langdon & Seah Singapore is registered as follows:

Quantity Surveying Consultancy Services

Panel 1

- Highest Category

Project Management Consultancy Services

Panel 1

Highest Category

BCA Contractors Registry System (CRS)

• The Contractors Registry was established to register contractors who provide construction-related goods and services to the public sector.

• Contractors who wish to be registered must show that they have the relevant experience, financial, technical and management capability.

BCA Contractors Registry System (CRS)

• Tendering Limits for BCA Registered Contractors as follows:

– Construction Workheads (CW01 and CW02)

Tendering Limit (S$mil)

1 Jul 2012 – 30 Jun 2013

1 Jul 2013 – 30 Jun 2014

A1

Unlimited

Unlimited

A2

85

85

B1

40

40

B2

13

13

C1

4

4

C2

1.3

1.3

C3

0.65

0.65

– Specialist Workheads (CR, ME MW and SY)

Tendering Limit (S$mil) Single

Grade

L6

Unlimited Unlimited

L5 L4 L3 L2

1 Jul 2012 – 30 Jun 2013 13 6.5

4 1.3

1 Jul 2013 – 30 Jun 2014 Unlimited Unlimited 13 6.5

4 1.3

Note: CR – Construction related workheads; ME – M&E workheads; MW – Maintenance workheads and SY – Supply workheads

• More information can be viewed at www.bca.gov.sg

L1

0.65

0.65

Basic Materials Price Trends

Global Construction Consultants

Construction Material Price Trends

PRICE TREND ON CEMENT IN BULK (ORDINARY PORTLAND CEMENT)

(a) Cement (S$/tonne)

130

120

110

S$99.60/ton

(Oct 2013)

100

90

80

Ja n-

06

A pr

-0

6

Ju l-0

6

Oct

-0

6

Ja n-

07

A pr

-0

7

Ju l-0

7

Oct

-0

7

Ja n-

08

A pr

-0

8

Ju l-0

8

Oct

-0

8

Ja n-

09

A pr

-0

9

Ju ly-

09

Oct

-0

9

Ja n-

10

A pr

-1

0

Ju l-1

0

Oct

-1

0

Ja n-

11

A pr

-1

1

Ju l-1

1

Oct

-1

1

Ja n-

12

A pr

-1

2

Ju l-1

2

Oct

-1

2

Ja n-

13

A pr

-1

3

Ju l-1

3

Oct

-1

3p

(20MM AGGREGATE)

S$/TONNE

70

60

50

40

30

S$20.00/ton

(Oct 2013)

20

10

Ja n-

06

M ar

-0

6

M ay-

06

Ju l-0

6

S ep

-0

6

N ov-

06

Ja n-

07

M ar

-0

7

M ay-

07

Ju l-0

7

S ep

-0

7

N ov-

07

Ja n-

08

M ar

-0

8

M ay-

08

Ju l-0

8

S ep

-0

8

N ov-

08

Ja n-

09

M ar

-0

9

M ay-

09

Ju ly-

09

S ep

-0

9

N ov-

09

Ja n-

10

M ar

-1

0

M ay-

10

Ju l-1

0

S ep

-1

0

N ov-

10

Ja n-

11

M ar

-1

1

M ay-

11

Ju l-1

1

S ep

-1

1

N ov-

11

Ja n-

12

M ar

-1

2

M ay-

12

Ju l-1

2

S ep

-1

2

N ov-

12

Ja n-

13

M ar

-1

3

M ay-

13

Ju l-1

3

S ep

-1

3

N ov-

13

S$/TONNE

50

40

30

20

70

60

S$22.20/ton

(Oct 2013)

10

Ja n-

06

M ar

-0

6

M ay-

06

Ju l-0

6

S ep

-0

6

N ov-

06

Ja n-

07

M ar

-0

7

M ay-

07

Ju l-0

7

S ep

-0

7

N ov-

07

Ja n-

08

M ar

-0

8

M ay-

08

Ju l-0

8

S ep

-0

8

N ov-

08

Ja n-

09

M ar

-0

9

M ay-

09

Ju ly-

09

S ep

-0

9

N ov-

09

Ja n-

10

M ar

-1

0

M ay-

10

Ju l-1

0

S ep

-1

0

N ov-

10

Ja n-

11

M ar

-1

1

M ay-

11

Ju l-1

1

S ep

-1

1

N ov-

11

Ja n-

12

M ar

-1

2

M ay-

12

Ju l-1

2

S ep

-1

2

N ov-

12

Ja n-

13

M ar

-1

3

M ay-

13

Ju l-1

3

S ep

-1

3

N ov-

13

(d) Ready-Mixed Concrete (S$/m 3 )

S$/CUBIC METRE

210

190

170

150

130

110

S$105.30/m 3

(Oct 2013)

90

70

Ja n-

06

Ap r-0

6

Ju l-0

6

Oct

-0

6

Ja n-

07

Ap r-0

7

Ju l-0

7

Oct

-0

7

Ja n-

08

Ap r-0

8

Ju l-0

8

Oct

-0

8

Ja n-

09

Ap r-0

9

Ju ly-

09

Oct

-0

9

Ja n-

10

Ap r-1

0

Ju l-1

0

Oct

-1

0

Ja n-

11

Ap r-1

1

Ju l-1

1

Oct

-1

1

Ja n-

12

Ap r-1

2

Ju l-1

2

Oct

-1

2

19

Ja n-

13

Ap r-1

3

Ju l-1

3

Oct

-1

3p

Source: Building & Construction Authority (as at 11 November 2013)

Construction Material Price Trends

S$/TONNE

1,800

1,600

1,400

1,200

1,000

S$732.00/ton

(Oct 2013)

800

600

Ja n-

06

M ar

-0

6

M ay-

06

Ju l-0

6

S ep

-0

6

N ov-

06

Ja n-

07

M ar

-0

7

M ay-

07

Ju l-0

7

S ep

-0

7

N ov-

07

Ja n-

08

M ar

-0

8

M ay-

08

Ju l-0

8

S ep

-0

8

N ov-

08

Ja n-

09

M ar

-0

9

M ay-

09

Ju ly-

09

S ep

-0

9

N ov-

09

Ja n-

10

M ar

-1

0

M ay-

10

Ju l-1

0

S ep

-1

0

N ov-

10

Ja n-

11

M ar

-1

1

M ay-

11

Ju l-1

1

S ep

-1

1

N ov-

11

Ja n-

12

M ar

-1

2

M ay-

12

Ju l-1

2

S ep

-1

2

N ov-

12

Ja n-

13

M ar

-1

3

M ay-

13

Ju l-1

3

S ep

-1

3

N ov-

13

Source: Building & Construction Authority (as at 11 November 2013)

(g) Copper (US$/tonne)

PRICE TREND ON COPPER

US$/TONNE

10,000

9,500

9,000

8,500

8,000

7,500

7,000

6,500

6,000

5,500

5,000

4,500

4,000

3,500

US$7,066/ton

(Nov 2013)

3,000

2,500

Ja n-

06

A pr

-0

6

Ju l-0

6

Oct

-0

6

Ja n-

07

A pr

-0

7

Ju l-0

7

Oct

-0

7

Ja n-

08

A pr

-0

8

Ju l-0

8

Oct

-0

8

Ja n-

09

A pr

-0

9

Ju ly-

09

Oct

-0

9

Ja n-

10

A pr

-1

0

Ju l-1

0

Oct

-1

0

Ja n-

11

A pr

-1

1

Ju l-1

1

Oct

-1

1

Ja n-

12

A pr

-1

2

Ju l-1

2

Oct

-1

2

Ja n-

13

A pr

-1

3

Ju l-1

3

Oct

-1

3p

Source: London Metal Exchange

US$/TONNE

3,200

3,000

2,800

2,600

2,400

2,200

2,000

1,800

1,600

US$1,749/ton

(Nov 2013)

1,400

1,200

Ja n-

06

Ap r-0

6

Ju l-0

6

Oct

-0

6

Ja n-

07

Ap r-0

7

Ju l-0

7

Oct

-0

7

Ja n-

08

Ap r-0

8

Ju l-0

8

Oct

-0

8

Ja n-

09

Ap r-0

9

Ju ly-

09

Oct

-0

9

Ja n-

10

Ap r-1

0

Ju l-1

0

Oct

-1

0

Ja n-

11

Ap r-1

1

Ju l-1

1

Oct

-1

1

Ja n-

12

Ap r-1

2

Ju l-1

2

Oct

-1

2

Ja n-

13

Ap r-1

3

Ju l-1

3

Oct

-1

3p

Source: London Metal Exchange

(h) Crude Oil (US$/Barrel)

PRICE TREND ON CRUDE OIL

US$/BARREL

90

80

70

60

120

110

100

150

140

130

50

40

30

20

10

US$106/Barrel

(Sep 2013)

0

Ja n-

06

M ar

-0

6

M ay-

06

Ju l-0

6

S ep

-0

6

N ov-

06

Ja n-

07

M ar

-0

7

M ay-

07

Ju l-0

7

S ep

-0

7

N ov-

07

Ja n-

08

M ar

-0

8

M ay-

08

Ju l-0

8

S ep

-0

8

N ov-

08

Ja n-

09

M ar

-0

9

M ay-

09

Ju ly-

09

S ep

-0

9

N ov-

09

Ja n-

10

M ar

-1

0

M ay-

10

Ju l-1

0

S ep

-1

0

N ov-

10

Ja n-

11

M ar

-1

1

M ay-

11

Ju l-1

1

S ep

-1

1

N ov-

11

Ja n-

12

M ar

-1

2

M ay-

12

Ju l-1

2

S ep

-1

2

N ov-

12

Ja

20 ar

-1

3

M ay-

13

Ju l-1

3

S ep

-1

3

N ov-

13

Source: Go-Tech

Construction Material Price Trends

Source: Building & Construction Authority (as at 11 November 2013)

Tender Price Index (TPI)

155

150

145

140

135

130

125

120

115

110

105

100

95

90

85

80

L&S

112.9

105.0

108.4

104.8

107.6

100.7

113.3

107.3

100.2

102.4

88.9

BCA*

91.8

90.4 91.2 90.6

87.9

88.1

89.9

95.6

98.9

100.0

96.9

100.0

91.4

108.0

131.6

103.2

150.0

137.3

122.5

120.9

116.8

^

123.3

^

^

123.3

^ 123.3

129.4

130.7

115.9

114.4 114.1

114.2

115.7

118.9

120.8

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 1Q13 2Q13 3Q13

Source: * Building and Construction Authority as at 15 November 2013

Note : With effect from the 1st Quarter of 2009, BCA has implemented the new TPI series with Base Year 2005 = 100. The TPI chart shown above has been amended accordingly to reflect the Base Year as Year 2005.

^ - L&S TPI is based on 4 th Quarter index

22

Tender Price Index (TPI) for 2013

• Based on tenders returned in the first 3 Quarters of 2013, tender prices have increased approximately 6% as compared to 4 th Quarter of 2012.

• The rise was mainly attributed to the pricing allowance by Contractors due to labour shortages arising from reduction in MYE and increase in foreign worker levies.

• The cost impact arising from labour shortages has been mitigated by the slight softening of basic construction material prices.

• Prices for cement, sand, ready-mixed concrete and reinforcement bars have dropped slightly and generally remained very stable and competitive.

• Taking the above into consideration, the anticipated tender price movement for 2013 could be in the range of

+6% to +7%

.

Tender Price Index (TPI) for 2014

• For 2014, BCA forecasts that the average construction demand is projected to be $22 billion - $30 billion p.a.

• The construction demand is anticipated to remain stable with the public sector projects making up for the lower volume in the private sector.

• Continued demand for skilled labour resources will lead to pricing pressure.

• Based on current market sentiments (Dec 2013), construction cost escalation for 2014 is anticipated to be in the range of

+3% to +5%

.

Upcoming Developments…

Global Construction Consultants

Upcoming Developments…

Changi Airport’s Terminal 5

Changi Airport's Terminal 5 will be ready in mid-2020s and the mega-terminal will be able to handle 50 million passenger movements per annum

1,080ha reclaimed site at Changi East will be redeveloped to become Terminal 5

Estimated to be US$35b

Upcoming Developments…

Paya Lebar Airbase

(move to Changi)

• A new airbase and a fourth runway will be built at Changi East, with the Paya Lebar airbase to be moved to Changi later on

The move will free up a large 800 hectare area in Paya Lebar – an area bigger than

Bishan or Ang Mo Kio – to build new homes, offices and factories

It will also remove height restrictions on a large area around Paya Lebar, freeing up land to “develop” new, exciting plans for the big chunk of eastern Singapore

Upcoming Developments…

Building a new port in Tuas

Consolidate all port operations in Singapore that are currently spread across Tanjong Pagar,

Keppel, Brani and Pasir Panjang

• These port leases will end from 2027 onwards and the new port will be “bigger and more efficient” so Singapore can stay a “hub port”

With the prime land in Tanjong Pagar freed up,

Singapore can build a new Southern Waterfront

City, the size of 1,000 hectares or 2.5 Marina

Bays, stretching from Shenton Way to Pasir

Panjang

Project value for Ports Reclaimation has been estimated to be around US$24.6b – US$32.8b

Project value for Port work are estimated around US$4.1b and more

Upcoming Developments…

Two New Rail Lines and Three New Extensions to Expand Rail Network by 2030

New Lines to Improve Connectivity and Accessibility

The Government has announced ambitious plans to expand the rail network by 2030, doubling it from the current 178 km to about 360 km

LTA will build a major MRT line, the 50-km Cross

Island Line (CRL), which will run across the span of Singapore. Starting from Changi, it will pass through Loyang, Pasir Ris, Hougang, Ang Mo Kio, before reaching Sin Ming. Continuing westwards, it will serve areas such as Bukit Timah, Clementi,

West Coast, and terminate at Jurong Industrial

Estate. Targeted to be completed by 2030, it will also provide commuters with another alternative for East-West travel to the current East-West Line

Extension to Areas not Served by Rail Network

• Three existing lines will also be extended to enhance commuters’ connectivity and provide them with greater accessibility

Upcoming Developments…

North-South Expressway

The North-South Expressway (NSE) is

Singapore’s eleventh expressway. It will run parallel to the Central Expressway (CTE) to alleviate the traffic load on the heavily utilised CTE as well as nearby major arterial roads such as Thomson Road and Marymount

Road

LTA has completed the alignment study and is currently embarking on the detailed engineering study. Advance works will start progressively from 2013 construction works in 2015 and major

Till 2030, the projected cost for LTA works would be USD2.5b – US$4.1b a year

Global Construction Consultants

Q & A ?

THANK YOU!

Global Construction Consultants

Download