THE GROWTH in retail prices of construction materials in Metro Manila continued in May to its highest level in more than 13 years, driven by the higher cost of imports and the reopening economy.
According to preliminary data from the Philippine Statistics Authority, the National Capital Region’s (NCR) construction materials retail price index (CMRPI) rose 6.2% year on year in May, against the 6.1% posted in April and the 1.2% growth rate from a year earlier.
The 6.2% rate was the highest for building materials prices in Metro Manila since the 7.4% growth reported in January 2009.
The May 2022 outcome also matched the February 2009 building materials retail price growth.
This brought the NCR’s CMRPI for the first five months to 4.7%, against the 1.2% in the year-earlier period.
Security Bank Corp. Chief Economist Robert Dan J. Roces attributed the increase in May to the cost of imported construction materials, which is rising due to supply chain issues, with the economy’s reopening also adding to inflation pressures.
“However, it may also be a function of the reopening story, which is doing well, and with activities at or very near pre-pandemic levels,” Mr. Roces said in an e-mail interview.
Global oil and commodity prices started rising even before Russia invaded Ukraine in February. The invasion eventually pushed prices of oil above $100 per barrel.
Another factor is China’s Covid containment policy, which produced congestion at the port of Shanghai, the world’s busiest. This also stalled operations at major technology and financial hubs, dampening activity in manufacturing and trade.
China’s countermeasures against the coronavirus have battered its economy.
Metro Manila and other parts of the Philippines have been placed under Alert Level 1, the most relaxed quarantine setting, since March.
Retail price growth in construction materials for most of the commodity groups increased in May led by carpentry materials, where prices were 2.1% higher in May, against the 1.5% growth rate logged in April.
Retail prices in the following categories also increased: masonry materials (3.9% from 3.3%), painting materials and related compounds (4.1% from 3.7%) and tinsmithry materials (8.3% from 8.1%).
Price growth in plumbing materials and electrical materials was unchanged from the prior month at 7.9% and 4%, respectively.
Price growth in miscellaneous construction materials slowed to 10.2% in May from 10.6% in April.
Retail construction prices reflect demand from small-scale building projects, including do-it-yourself builders and small contractors.
Construction activity is expected continue picking up assuming no further lockdowns, Mr. Roces said. — Abigail Marie Pelea Yraola