Transcript Construction Material Price Trends

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?
2
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.
6
Construction Activity / Demand
Global Construction Consultants
Construction Activity / Demand
40.0
$35.5bn
$35.7bn
36.0
$30.7bn
Value [S$ Billion]
32.0
$27.6bn
28.0
$24.5bn
$24.0bn
$22.5bn
24.0
20.0
2013f
$28bn to
$34bn
$16.3bn
$18.3bn
$15.3bn
16.0
$16.8bn
$14.1bn
$12.7bn $13.3bn
$14.5bn
$10bn
12.0
$11.5bn
$10.3bn
8.0
4.0
0.0
1995
Private Sector
1996 1997
1998
1999 2000
Public Sector
2001
2002 2003
Total Value
2004
2005 2006
2007
2008 2009
2010
2011 2012p 2013f
Year
Source: BCA as at 3 September 2013
Private Sector
Public Sector
Total Value
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012p 2013f
8.3
9.7 12.7
5.9
6.7
8.1
7.0
4.8
4.6
5.7
7.5 13.1 18.8 20.2
8.6 19.0 20.2
21.2 15-18.5
8.0
8.6 11.3
9.4
6.0
5.2
7.1
9.6
5.4
4.6
4.0
3.7
5.7 15.5 13.9
8.6 15.3
9.5 13-15.5
16.3 18.3 24.0 15.3 12.7 13.3 14.1 14.5 10.0 10.3 11.5 16.8 24.5 35.7 22.5 27.6 35.5
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
Public
Engineering
Residential
21.4%
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#
Total for Both
Public and Private Sectors
Forecast
(Average Annual)
S$22 billion to S$30 billion
Source: BCA as at 3 September 2013
11
Categorization of Consultants and
Contractors in Singapore
Global Construction Consultants
Public Sector Panels of Consultants (PSPC)
• The Public Sector Panels of Consultants (PSPC) is to facilitate the Government
in appointing consultants to undertake building development projects.
• It lists companies that provide consultancy services for public sector building
and construction projects, categorized by different disciplines and different
project cost range.
• PSPC Disciplines c/o:
– Architects (Arch)
– Civil / Structural (CS) Engineers
– Mechanical & Electrical (M&E) Engineers
– Quantity Surveyors (QS)
– Project Managers (PM)
13
Public Sector Panels of Consultants (PSPC)
• Tendering Limits for PSPC Panel Firms as follows:
– Arch, CS Engineers, M&E Engineers and QS Disciplines
Tendering Limits (S$ million)
1 Jul 2013 – 30 Jun 2014
Panel 1
Panel 2
Panel 3
Panel 4
13 to 85
4 to 40
Up to 13
Up to 4
– PM Discipline
Tendering Limits (S$ million)
1 Jul 2013 – 30 Jun 2014
Panel 1
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
14
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
15
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.
16
BCA Contractors Registry System (CRS)
• Tendering Limits for BCA Registered Contractors as follows:
– Construction Workheads (CW01 and CW02)
Tendering Limit (S$mil)
A1
A2
B1
B2
C1
C2
C3
1 Jul 2012 – 30 Jun 2013
Unlimited
85
40
13
4
1.3
0.65
1 Jul 2013 – 30 Jun 2014
Unlimited
85
40
13
4
1.3
0.65
– Specialist Workheads (CR, ME MW and SY)
Tendering Limit (S$mil)
Single
Grade
L6
L5
L4
L3
L2
L1
1 Jul 2012 – 30 Jun 2013
Unlimited
Unlimited
13
6.5
4
1.3
0.65
1 Jul 2013 – 30 Jun 2014
Unlimited
Unlimited
13
6.5
4
1.3
0.65
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
17
Basic Materials Price Trends
Global Construction Consultants
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S$20.00/ton
(Oct 2013)
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PRICE TREND ON GRANITE
(20MM AGGREGATE)
S$/TONNE
l-0
6
(c) Granite (S$/tonne)
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S$/Tonne
S$99.60/ton
(Oct 2013)
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40
S$/m3
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S$/Tonne
110
Ap
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30
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6
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Ap
r
Ja
(a) Cement (S$/tonne)
Ja
S$/Tonne
PRICE TREND ON CEMENT IN BULK (ORDINARY PORTLAND CEMENT)
S$/TONNE
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Construction Material Price Trends
(b) Sand (S$/tonne)
PRICE TREND ON CONCRETING SAND
S$/TONNE
130
70
120
60
50
40
100
30
S$22.20/ton
(Oct 2013)
90
20
80
10
(d) Ready-Mixed Concrete (S$/m3)
PRICE TREND ON READY-MIXED CONCRETE
S$/CUBIC METRE
210
190
50
170
150
130
S$105.30/m3
(Oct 2013)
110
90
70
19
Source: Building & Construction Authority (as at 11 November 2013)
Source: Building & Construction Authority (as at 11 November 2013)
(g) Copper (US$/tonne)
PRICE TREND ON COPPER
US$/TONNE
7,000
6,500
6,000
Source: London Metal Exchange
US$7,066/ton
(Nov 2013)
5,500
5,000
2,500
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3p
1,000
S$732.00/ton
(Oct 2013)
Ja
1,200
US$/Tonne
1,800
US$/Barrel
S$/Tonne
PRICE TREND ON STEEL BARS (16-32MM HIGH TENSILE)
S$/TONNE
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(e) Steel Bars (S$/tonne)
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US$/Tonne
Construction Material Price Trends
(f) Aluminium (US$/tonne)
PRICE TREND ON ALUMINIUM
US$/TONNE
3,200
1,600
3,000
1,400
2,800
2,600
800
2,400
10,000
150
9,500
140
9,000
130
8,500
120
8,000
110
7,500
100
70
60
50
Source: Go-Tech
US$1,749/ton
(Nov 2013)
2,200
2,000
1,800
1,600
600
1,400
1,200
Source: London Metal Exchange
(h) Crude Oil (US$/Barrel)
PRICE TREND ON CRUDE OIL
US$/BARREL
90
80
US$106/Barrel
(Sep 2013)
4,500
40
4,000
30
3,500
20
3,000
10
0
20
Construction Material Price Trends
21
Source: Building & Construction Authority (as at 11 November 2013)
Tender Price Index (TPI)
155
150.0
150
L&S
Tender Price Index (Base Year at 2005)
145
BCA*
140
135
129.4 130.7
131.6
130
137.3
125
120
115
110
105
100
95
112.9
108.4
102.4
98.9
91.8
90.4 91.2 90.6
87.9
80
100.0
95.6
88.9
85
115.9
108.0
105.0
90
120.9^
116.8^
122.5
113.3
107.6 107.3
104.8
100.2
100.7
123.3^ 123.3^ 123.3
88.1 89.9
114.4 114.1 114.2
115.7
118.9
120.8
103.2
100.0
96.9
91.4
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 4th 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 4th 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%.
23
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%.
24
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 and major
construction works in 2015
• Till 2030, the projected cost for LTA works
would be USD2.5b – US$4.1b a year
Q&A?
Global Construction Consultants
THANK YOU!
Global Construction Consultants