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Summary

The construction sectors GDP grew by 6.2% year-on-year in the first


quarter of 2016, higher than the 4.9% in the preceding quarter. The growth was
largely supported by public sector construction works and private industrial
building works. Similarly, total construction demand1 increased by 5.4% year-onyear to $8.9 billion in the first quarter, underpinned by the strong demand for public
sector civil engineering works.
Average market prices for cement, granite and ready-mixed concrete (G40
Pump) generally trended downwards compared to a quarter ago. By contrast, the
average market prices for rebar increased as compared to the preceding quarter.
Looking ahead into the immediate next few months, prices for ready-mixed concrete
(G40 Pump) and its raw materials are expected to remain competitive.

Latest Update
In the month of April 2016, preliminary average market prices of cement
(Ordinary Portland) in bulk and granite (20mm Aggregate) were $84.62 per tonne
and $16.03 per tonne respectively. Preliminary average price of ready-mixed concrete
(Grade 40 Pump) was $85.72 while that for steel rebar (16 to 32 mm High Tensile)
was $5344 per tonne in the same month.

All Construction demand (contracts awarded) values stated in this article exclude reclamation projects.
Material prices included delivery to site cost.
3 Material prices excluded delivery to site cost.
4 With effect from Jan 2015, the market prices of rebar stated in the article are based on fixed price supply
contracts with contract period 1 year or less.
1
2

Detailed Review for First Quarter 2016


CONSTRUCTION GDP
The Singapore economy grew by 1.8% on a year-on-year basis in the first quarter of 2016,
unchanged from the preceding quarter.5 The growth was supported by the construction and
services sectors, which increased by 6.2% and 1.4% year-on-year respectively. The Ministry of
Trade and Industry (MTI) has maintained the GDP growth forecast for 2016 at 1.0%-3.0% (Graph
1).
GRAPH 1: CONSTRUCTION GDP GROWTH RATES
14.0
12.0

% Change

10.0
8.0
6.0
4.0
2.0
0.0
-2.0
-4.0
I

II

III

IV

2011

II

III

IV

2012

II

III

IV

2013

II

III

IV

2014

II

III

IV

2015

I
2016

Quarter

In tandem with the higher year-on-year growth in the construction sector as compared to
a quarter ago, the construction GDP share increased to 5.0%, from 4.8% in the preceding quarter.
(Graph 2).

GRAPH 2: CONSTRUCTION GDP GROWTH RATES


5.2
5.0

% Change

4.8
4.6
4.4
4.2
4.0
3.8
I

II

III

2011

IV

II

III

IV

2012

II

III

2013
Quarter

Economic Survey of Singapore, First Quarter 2016

IV

II

III

2014

IV

II

III

2015

IV

I
2016

CONSTRUCTION DEMAND (CONTRACTS AWARDED)


On a year-on-year basis, total construction demand increased by 5.4% to $8.9 billion in the
first quarter of 2016. The improvement was largely driven by the exceptionally strong demand for
civil engineering works. By contrast, the private sector construction demand contracted due to an
across-the-board reduction in the contract awards for all development types as compared to the
same period a year ago (Graph 3 and Table 1).

GRAPH 3: CONSTRUCTION DEMAND


(IN TERMS OF CONTRACTS AWARDED)
12,000

$ Million

10,000
8,000
6,000
4,000
2,000
0
I

II

III

IV

2011

II

III

IV

2012

II

III

2013
Quarter

Total

Public

IV

II

III

IV

2014

II

III

IV

2015

I
2016

Private

TABLE 1: YEAR-ON-YEAR CHANGE IN CONSTRUCTION DEMAND

Construction Demand
2015Q1
($m)

2016Q1
($m)

Year-on-Year
Change
(%)

Both Sectors

8,404.45

8,857.69

5.4

Public Sector
Residential
Commercial
Industrial
Institutional & Others
Civil Engineering

4,168.01
1,582.93
44.61
228.97
1,772.04
539.47

7,661.60
1,296.11
60.24
15.79
1,596.68
4,692.78

83.8
-18.1
35.0
-93.1
-9.9
769.9

Private Sector
Residential
Commercial
Industrial
Institutional & Others
Civil Engineering

4,236.44
1,227.76
806.37
1,457.37
551.03
193.92

1,196.08
186.06
332.84
434.94
141.74
100.50

-71.8
-84.8
-58.7
-70.2
-74.3
-48.2

Development Type

Similarly, on a quarter-on-quarter basis, total construction demand increased by 37.1% as


the expansion in the public sector construction demand more than outweighed the quarterly fall
in the private sector construction demand (Table 2).

TABLE 2: QUARTERLY CONSTRUCTION DEMAND

Construction Demand
Development Type

2015Q3
($m)

2015Q4
($m)

2016Q1
($m)

Both Sectors

4,116.84

6,460.05

8,857.69

Public Sector
Residential
Commercial
Industrial
Institutional & Others
Civil Engineering

1,872.65
717.52
173.31
115.69
357.24
508.89

3,480.42
1,038.60
52.84
419.80
761.20
1,207.98

7,661.60
1,296.11
60.24
15.79
1,596.68
4,692.78

Private Sector
Residential
Commercial
Industrial
Institutional & Others
Civil Engineering

2,244.20
340.04
368.72
1,015.99
366.12
153.32

2,979.64
741.66
365.89
561.11
111.56
1,199.42

1,196.08
186.06
332.84
434.94
141.74
100.50

Public Sector
Public sector residential construction demand increased by 24.8% quarter-on-quarter,
supported by the award of various new public housing projects which comprised of 7,542
housing units to be built in estates including Punggol North, Bidadari and Sengkang as well as an
increase in upgrading contracts. On a year-on-year basis, the demand was lower partly on
account of the high statistical base recorded a year ago.
The construction demand for all other building types with the exception of industrial
developments, grew quarter-on-quarter. In particular, the construction demand for institutional
and other building works reached $1.6 billion in the first quarter, doubled the $0.8 billion
recorded in the preceding quarter. The significant increase was supported by the award of a
number of notable projects such as the new State Courts Complex, Outram Community Hospital
and the Centre for Oral Health. On a year-on-year basis, the demand for industrial and
institutional developments declined.
The demand for civil engineering works expanded significantly both quarter-on-quarter
and year-on-year and reached $4.7 billion in the first quarter. The surge was largely supported by
the construction of LTAs 4-in-1 rail and bus depot (East Coast Integrated Depot) and various
stations and tunnels for the Thomson-East Coast MRT Line (TEL).

Private Sector
The total private sector construction demand fell by 59.9% on a quarter-on-quarter basis
and 71.8% on a year-on-year basis largely due to a reduction in construction demand for all
building works with the exception of institutional developments.
In light of the current slowdown in the property market and continued market
uncertainties, the private sector residential construction demand continued to soften to $0.2
billion in the first quarter, the lowest quarterly demand recorded since the Global Financial Crisis
in 2008/9.

The demand for commercial developments declined significantly year-on-year but was
comparable to the preceding quarter, supported mainly by the construction of a commercial
building at Robinson Road and addition and alteration works to the existing North Point
Shopping Centre at Yishun Avenue 2 as well as to existing Grand Park City Hall Hotel at
Coleman Street.
The demand for industrial developments declined by 22.5% quarter-on-quarter and 70.2%
year-on-year. Nonetheless, the awards of T-space @ Tampines and other smaller industrial
projects provided some support to this category. On the other hand, the demand for institutional
developments improved compared to a quarter ago but contracted on a year-on-year basis.
Construction demand for private civil engineering works fell significantly quarter-onquarter due to the high base in the preceding quarter supported by the award of the 3-Runway
System (Package 1) for Changi Airport. The demand for private civil engineering works
continued to stay subdued.

CONSTRUCTION VOLUME (PROGRESS PAYMENTS)


Total nominal construction output registered a 7.1% increase year-on-year to $9.2 billion in
the first quarter of 2016, supported by a pick-up in on-site construction activities from both the
public and private sectors (Graph 4). However, on a quarter-on-quarter basis, the output volume
declined by 3.8%.

GRAPH 4: CONSTRUCTION VOLUME


(IN TERMS OF CERTIFIED PROGRESS PAYMENTS)
12,000

$ Million

10,000
8,000
6,000
4,000
2,000
0
I

II

III IV

2011

II

III IV

2012

* - preliminary data

Total

II

III IV

2013
Quarter
Public

II

III IV

2014

II

III IV I*

2015

2016

Private

The public sectors total construction output increased by 8.5% year-on-year to $4.0 billion,
mainly underpinned by an increase in civil engineering construction output which in turn was
supported by the construction of various stations and tunnels for the TEL as well as land
preparation works for Changi Airport Terminal 5 development. However, on a quarter-on-quarter
basis, total public sector construction output fell by 5.5% as a result of a moderation in output
from public residential projects. Some of the other notable on-going projects that provided
support to the public sector construction output in the first quarter included Phase 3 of the

Liquefied Natural Gas (LNG) Terminal at Jurong Island, Sengkang General/Community Hospital
and advanced work at depot at Laguna Golf Green.
Similarly, total private sector construction output increased year-on-year but declined
marginally quarter-on-quarter, reaching $5.2 billion. The work done in the first quarter was
underpinned by a year-on-year increase in industrial and institutional construction output,
supported by various Engineering, Procurement and Construction (EPC) projects, development of
Changi Airport Terminal 4 and Mapletree Business City II at Alexandra Terrace. Similar to past
trend, residential building construction output continued to account for the largest share of the
overall private sector construction activities, backed by on-going condominium developments
such as Corals at Keppel Bay at Keppel Bay Drive, The Crest at Prince Charles Crescent and The
Glades at Bedok Rise.

CONSTRUCTION MATERIALS
Quarterly demands for cement, granite and ready-mixed concrete (G40 pump) decreased
in the first quarter of 2016 as compared to the preceding quarter, while that of rebar remained
comparable to a quarter ago. The average market prices of all of the key construction materials
with the exception of rebar softened as compared to a quarter ago. Over the next few months, the
market prices of ready-mixed concrete and its raw materials are expected to remain competitive.
Cement
Demand and Supply
Demand for cement decreased by 15% quarter-on-quarter to 1.29 million tonnes (Graph 5).
Almost all of the cement demand was supported by imports, with sources from Japan (66%),
China (12%), Malaysia (8%), Taiwan (7%), Thailand (6%) and Korea (1%).

GRAPH 5: DEMAND FOR CEMENT


1,800
1,600
1,400

('000 tonnes)

1,200
1,000
800
600
400
200
0
I

II

III

2011

IV

II

III

2012

IV

II

III

IV

2013
Quarter

II

III

2014

IV

II

III

2015

IV

I
2016

Prices
Average market price of bulk cement (with delivery) decreased from $90.80 per tonne in
December 2015 to $86.70 per tonne in March 2016. Cement prices are likely to remain competitive.
Granite
Demand and Supply
Demand for granite decreased by 11% quarter-on-quarter to 4.72 million tonnes (Graph 6).
Malaysia and Indonesia remained as the key sources of granite imports.

GRAPH 6: DEMAND FOR GRANITE


7,000
6,000

('000 tonnes)

5,000
4,000
3,000
2,000
1,000
0
I

II

III

2011

IV

II

III

2012

IV

II

III

IV

2013

II

III

2014

IV

II

III

2015

IV

I
2016

Quarter

Prices
Average market price of 20mm granite decreased from $17.80 per tonne in December 2015
to $16.00 per tonne in March 2016. The average price for 20mm granite is expected to remain
competitive.

Ready-Mixed Concrete
Demand and Supply
Demand for ready-mixed concrete decreased by 11% quarter-on-quarter to 3.5 million
cubic metres (Graph 7).

GRAPH 7: DEMAND FOR READY-MIXED CONCRETE


4,500
4,000

('000 cubic metres)

3,500
3,000
2,500
2,000
1,500
1,000
500
0
I

II

III IV

2011

II

III IV

2012

II

III IV

2013

II

III IV

2014

II

III IV

2015

I
2016

Quarter

Prices
Average market price of ready-mixed concrete (Grade 40 Pump with delivery) decreased
from $95.90 per cubic metre in December 2015 to $87.20 per cubic metre in March 2016. The
average price for ready-mixed concrete (G40 Pump) is expected to remain competitive.

Steel Reinforcement Bars


Demand and Supply
Demand6 for steel reinforcement bars (rebars) in the first quarter decreased by a marginal
0.2% quarter-on-quarter to 0.36 million tonnes (Graph 8). China continued to dominate the import
sources, accounting for 94% of the total imports.

Demand for steel rebar is measured in terms of local production and net imports.

GRAPH 8: DEMAND FOR STEEL REINFORCEMENT BARS


700
600

('000 tonnes)

500
400
300
200
100
0
I

II

III IV

2011

II

III IV

2012

II

III IV

2013

II

III IV

2014

II

III IV

2015

I
2016

Quarter

Prices
The average market price for 16 to 32 mm high tensile rebars rebounded from $397.10 per
tonne in December 2015 to $446.6 per tonne in March 2016. The uptrend from January to April
2016 was mainly caused by a surge in speculative commodity futures trading in China. However,
market analysts do not expect a strong and sustained recovery of steel market due to persistent
overcapacity.

26 May 2016
BUILDING AND CONSTRUCTION AUTHORITY

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