Katrina Will Bring Varied Impacts on Construction
Washington, D.C., Sept. 2--Ken Simonson, chief economist of The Associated General Contractors of America (AGC) said the devastation wrought by Hurricane Katrina will have varied impacts on construction markets for the rest of 2005 and into 2006.
"Unfortunately, Katrina will push many (constructions) costs much higher. Contractors use a lot of diesel fuel for off-road equipment, their own trucks, and the multitude of deliveries of materials and equipment," Simonson said.
"Petroleum or natural gas is a key ingredient in asphalt, roofing materials, plastic pipe and insulation. And energy costs are built into the price of mining, milling, making, molding, and transporting metals, concrete and most other construction materials.
"Cement was already in short supply in 32 states and the District of Columbia
last month," Simonson noted. "The disruption to ocean, barge and rail transport from Katrina, and the loss of power to cement plants in the storm’s path, will cut further into cement supplies.
"At the same time, the urgent need to stabilize and rebuild roads, other infrastructure and buildings will increase demand for cement and other materials.
"We have been urging the Commerce Department and the Southern Tier Cement Committee to reach immediate agreement on a way to allow Mexican cement into the Gulf states without the punitive 55 percent duty now in place," Simonson said. "Now the need for that cement is truly critical."
Related Topics:Associated General Contractors of America