Construction industry suffers from increased raw material costs

Dusseldorf During the pandemic, construction was one of the most stable sectors in Germany: while many companies struggled with declining sales, growth in construction proved to be very crisis-resistant.

However, in view of the upheavals on the global raw materials markets as a result of the Ukraine war, the industry is now increasingly coming under cost pressure. Because the prices for important primary materials such as steel or certain plastics have been skyrocketing for weeks.

Before the outbreak of war, a tonne of construction steel cost between 820 and 860 euros per tonne, but by the beginning of April the price had risen to up to 1,300 euros per tonne. “As a result of the war, the material prices for many raw materials fluctuate significantly more,” said Klaus Wohlrabe, head of surveys at the Munich Ifo Institute. In addition, many companies obtain their primary products from Russia or the Ukraine. “That makes construction planning more difficult.”