Rising steel, cement prices to impact real estate

28 May 2021 CW Team

Demand is expected to be muted in the current April-June quarter due to an increase in coronavirus infections and state-imposed lockdowns. When sales are slow, developers typically launch offers and promotions to entice customers. However, there is now concern about rising cement, iron, and steel prices.

According to Care Ratings, the price of the hot-rolled coil (HRC) in the domestic market averaged Rs 63,633 per tonne in May, up 9% month on month and 75% year on year. Steel prices have risen in recent months as global demand has increased despite tight supply. In recent weeks, iron ore prices have more than doubled year on year, reaching $230 per tonne.

Rising pet coke, coal, and fuel costs, as well as freight rates, have all contributed to an increase in cement prices, which is another important raw material for real estate companies. According to JM Financial Institutional Securities, cement prices in India increased by 6% on a quarterly basis in April. Cement prices in the East India region increased by nearly 21% during the same time period.

Plastics, polymers, and resins used in piping and insulation, according to developers, have also increased in price. This increase in raw material prices is bound to have an impact on the bottom line of businesses.

In the last three months, iron prices have risen by Rs 20,000 per tonne, representing a nearly 50% increase. Aside from that, copper and aluminium prices have risen, impacting construction costs, said Ashok Mohanani, president of the National Real Estate Development Council (NAREDCO) in Maharashtra.

This increase in raw material prices will “put the brakes on the recovery of the real estate sector” at a time when the second wave of the pandemic and state restrictions are already putting pressure on the sector, according to Mohanani.

Developers say they may be unable to lower prices or offer additional promotions due to the unprecedented raw material price increase, despite the fact that sentiment remains subdued due to the pandemic. Rather, if the Covid-19 crisis is contained, prices may only begin to rise in a few quarters.

The current temporary slowdown in housing demand caused by the second wave has raised the prospect of a price correction. The reality is that if the current rising inflationary trends continue, developers will be forced to raise property prices. While demand may be low, operating costs for developers have already skyrocketed, Anil Pharande, chairman and MD of Pharande Spaces told the media.

Image Source

Also read: Steel prices: In a year, HRC up 40%, TMT 30%; Consumption to grow 10%

Also read: Price hike of raw materials severely hit construction sector

Also read: Cement price escalation to impact real estate projects: NHAI

In the January-March quarter, real estate developers experienced a strong recovery. However, the second wave of Covid-19, as well as rising raw material costs, have placed them in a catch-22 situation. Demand is expected to be muted in the current April-June quarter due to an increase in coronavirus infections and state-imposed lockdowns. When sales are slow, developers typically launch offers and promotions to entice customers. However, there is now concern about rising cement, iron, and steel prices. According to Care Ratings, the price of the hot-rolled coil (HRC) in the domestic market averaged Rs 63,633 per tonne in May, up 9% month on month and 75% year on year. Steel prices have risen in recent months as global demand has increased despite tight supply. In recent weeks, iron ore prices have more than doubled year on year, reaching $230 per tonne. Rising pet coke, coal, and fuel costs, as well as freight rates, have all contributed to an increase in cement prices, which is another important raw material for real estate companies. According to JM Financial Institutional Securities, cement prices in India increased by 6% on a quarterly basis in April. Cement prices in the East India region increased by nearly 21% during the same time period. Plastics, polymers, and resins used in piping and insulation, according to developers, have also increased in price. This increase in raw material prices is bound to have an impact on the bottom line of businesses. In the last three months, iron prices have risen by Rs 20,000 per tonne, representing a nearly 50% increase. Aside from that, copper and aluminium prices have risen, impacting construction costs, said Ashok Mohanani, president of the National Real Estate Development Council (NAREDCO) in Maharashtra. This increase in raw material prices will “put the brakes on the recovery of the real estate sector” at a time when the second wave of the pandemic and state restrictions are already putting pressure on the sector, according to Mohanani. Developers say they may be unable to lower prices or offer additional promotions due to the unprecedented raw material price increase, despite the fact that sentiment remains subdued due to the pandemic. Rather, if the Covid-19 crisis is contained, prices may only begin to rise in a few quarters. The current temporary slowdown in housing demand caused by the second wave has raised the prospect of a price correction. The reality is that if the current rising inflationary trends continue, developers will be forced to raise property prices. While demand may be low, operating costs for developers have already skyrocketed, Anil Pharande, chairman and MD of Pharande Spaces told the media. Image Source Also read: Steel prices: In a year, HRC up 40%, TMT 30%; Consumption to grow 10% Also read: Price hike of raw materials severely hit construction sector Also read: Cement price escalation to impact real estate projects: NHAI

Technology

29 Jul 2026

AI-Enabled Workflows Lift Profitability and Productivity

Organisations modernising frontline workflows with artificial intelligence, automation and real-time data are reporting stronger financial performance, higher productivity and improved employee engagement, according to a global study by Zebra Technologies and Oxford Economics.The research covered 1,000 senior leaders across retail, manufacturing, transportation and logistics in the US, Mexico, the UK, Germany, India, Japan, Australia and New Zealand.In transportation and logistics, 54 per cent of companies that improved picking and packing operations reported faster operational performance, wh..

Real Estate

29 Jul 2026

India Leads Global AI Readiness but Implementation Lags

Indian companies lead global averages across all eight artificial intelligence readiness indicators tracked by JLL, but only 19 per cent have started making changes to their workplaces, according to the JLL 2026 Future of Work Survey.The study found that 77 per cent of Indian business leaders expect AI to change their office requirements, creating a 58-percentage-point gap between awareness and implementation. The survey covered more than 2,200 CEOs, CFOs and real estate leaders across 21 countries during the first quarter of 2026.Despite concerns over automation, 58 per cent of Indian leaders..

Equipment

29 Jul 2026

Three WOLFF Cranes Build Riyadh Cable-Stayed Bridges

Three WOLFF 180 B luffing jib cranes are supporting the construction of two cable-stayed bridges alongside the existing Wadi Laban Bridge in Riyadh, Saudi Arabia. The project is being developed for the Royal Commission for Riyadh City and executed by the ICRC joint venture comprising IC Ictas and Al Rashid Trading & Contracting Company.The cranes are handling lifting operations including formwork, reinforcement, concrete placement, work platforms, surveying equipment and other construction materials. Each crane is fitted with a 40 m jib, reaches a hook height of 157 m and offers a maximum ..