Common materials up 5.30%, market construction prices up 1.57% from first half
Facility material prices for government construction projects rose an average of 4.98% in the second half of this year compared to the first half.
The Public Procurement Service announced Thursday the prices for a total of 6,584 items to be applied in calculating government construction costs for the second half of this year. The list covers 6,029 common facility material items and 555 items priced on a per-unit construction cost basis — known as market construction prices — which combine material and labor costs for unit work categories such as length and area.
Government construction costs are reviewed twice a year through regular investigations that analyze fluctuations in market transaction prices for raw materials and labor. The latest investigation found that common materials rose an average of 5.30% and market construction prices rose an average of 1.57% compared to the first half of this year.
Rising raw material costs driven by the war in the Middle East and higher market labor rates were identified as the main factors behind the increase in facility material prices. The construction cost index and the producer price index rose 3.80% and 5.57%, respectively, from the previous survey.
"Setting appropriate construction costs is of paramount importance for ensuring safety at construction sites and the quality of facilities," said Lim Byeong-cheol, director general of the facility project bureau at the Public Procurement Service. "We will continue to push for system improvements so that reasonable market prices can be reflected in a timely manner."
The prices determined in this investigation will be made public Thursday through the Korea ON-line E-Procurement System and the integrated construction cost management system for use by other government agencies and public institutions. They are set to take effect starting with Public Procurement Service construction bids for which base amounts are announced Oct. 12.
kwonhl@heraldcorp.com
