Malaysian infrastructure demand to escalate cement price rises

Malaysia's building materials are expected to se a price rise in the 3Q19 as large construction projects hike up demand for products such as cement.

The construction industry is expected to pick up this quarter on infrastructure projects, including the East Coast Rail Link, brokerage analyst Abdul Hadi Manaf noted. "As such, we believe that demand for cement and steel should also recover at a gradual pace," he said.

Cement costs could go up by 10 per cent to MYR220/t (US$52/t) in the fourth quarter and rise again to MYR250/t in 2020, as the sector's price war eases in the wake of infrastructure conglomerate YTL Corp’s take-over of rival cement producer Lafarge, reports the Business Times.

Meanwhile, Fitch trimmed its expectations for the residential, commercial and industrial building sectors in Malaysia, citing lower planned supply and short-term macroeconomic uncertainties. It now projects the overall construction sector to grow by 1.1 per cent in 2019 and 3.5 per cent in 2020.