Higher commodity prices curb highway construction projects
ROADS & HIGHWAYS

Higher commodity prices curb highway construction projects

A significant rise in commodity prices has taken a toll on the construction of highways in India.

During the first two months of the current fiscal year (FY), highway construction stood at just 21 km a day, compared to 24 km a day during the same period in the last FY and 29 km per day in FY22.

The pace of highway construction is higher than that of the Covid-19 pandemic year in the first two months of 2020. For FY22-23, the Ministry of Road Transport and Highways (MoRTH) had set a target of 50 km per day for highway construction.

In the April-May period of the current FY, a total of 1,307 km of highway has been constructed by all the implementing agencies, including the National Highways Authority of India (NHAI).

Analysts recorded a decline in the pace of construction due to high prices of construction materials like cement, steel and bitumen. The prices of such commodities have started lowering due to the onset of the monsoon might curb the pace of construction in the next two months.

The price hike and the high volatility in commodity prices, after witnessing a huge increase in the second half (H2) of FY22, have made some of the contractors wait and watch. It has affected the pace of execution of the projects in the first two months.

Lowering the prices of some commodities like steel, etc., the pace of execution should improve.

Project awards dropped to just 496 km in the April-May period of this FY, as against 663 km during the same period in the last FY and 747 km a year before. MoRTH aims to award an 18,000 km highway construction project in the current FY.

Image Source

Also read: Ways to deal with the current construction materials prices hike

A significant rise in commodity prices has taken a toll on the construction of highways in India. During the first two months of the current fiscal year (FY), highway construction stood at just 21 km a day, compared to 24 km a day during the same period in the last FY and 29 km per day in FY22. The pace of highway construction is higher than that of the Covid-19 pandemic year in the first two months of 2020. For FY22-23, the Ministry of Road Transport and Highways (MoRTH) had set a target of 50 km per day for highway construction. In the April-May period of the current FY, a total of 1,307 km of highway has been constructed by all the implementing agencies, including the National Highways Authority of India (NHAI). Analysts recorded a decline in the pace of construction due to high prices of construction materials like cement, steel and bitumen. The prices of such commodities have started lowering due to the onset of the monsoon might curb the pace of construction in the next two months. The price hike and the high volatility in commodity prices, after witnessing a huge increase in the second half (H2) of FY22, have made some of the contractors wait and watch. It has affected the pace of execution of the projects in the first two months. Lowering the prices of some commodities like steel, etc., the pace of execution should improve. Project awards dropped to just 496 km in the April-May period of this FY, as against 663 km during the same period in the last FY and 747 km a year before. MoRTH aims to award an 18,000 km highway construction project in the current FY. Image Source Also read: Ways to deal with the current construction materials prices hike

Next Story
Technology

Autodesk Releases 3rd Annual State of Design & Make Report

Autodesk, Inc has released its 3rd annual State of Design & Make report, spotlighting India’s leadership in using AI to drive sustainability. The report reveals that more than half of Indian business leaders are already using AI to deliver environmentally responsible outcomes which is way above the global average including APAC.Indian business leaders are optimistic about AI's transformative potential with 79% believing that AI will enhance their industry, well above the global average of 69%. As AI becomes more integral to business strategy, 52% of leaders say the ability to work with A..

Next Story
Resources

Praj Reports FY 25 Revenue at Rs 32,280.422 Million

Praj Industries (Praj), announced its audited financial results for the quarter and full year ended March 31, 2025. Performance review for Q4 FY25 - consolidated:Income from operations stood at Rs 8,596.809 million (Q4 FY24: Rs  10,185.646 million; Q3 FY25: Rs  8,530.279 million)PBT is at Rs  582.519 million (Q4 FY24: Rs  1,230.237 million; Q3 FY25: Rs  588.220 million)PAT is at Rs  398.169 million (Q4 FY24: Rs  919.361 million; Q3 FY25: Rs  411.044 million) • Order intake during the quarter Rs  10,320 millionPerformance review for FY25 - con..

Next Story
Resources

Six Raimondi Flat-Tops Cranes Deployed for Dublin Landmark Project

Walls Construction, one of Ireland’s leading construction companies, has deployed six Raimondi MRT573 flat-top tower cranes for the development of a landmark mixed-use project in Rathborne, Dublin. Supplied by Irish Cranes & Lifting, the official Raimondi agent in Ireland, these cranes represent the heaviest lifting capacities in the company’s fleet and will remain onsite for approximately 24 months until project completion.Robert Coffey, Director General of Irish Cranes, highlighted the longstanding collaboration between Irish Cranes and Walls Construction. “We are proud to con..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?