Construction materials sector’s production rises

ISTANBUL

Production of the Turkish construction materials industry has exhibited an annual increase of 1.3 percent in March from a year ago, according to the data from the trading group.

The annual increase in the sector’s output in the first half of 2023 was 1.2 percent, said the Association of Construction Materials Producers (İMSAD).

Some 11 sub-industries operating in the sector reported an increase in their production, while the remaining 11 sub-industries saw declines in output, according to a survey carried out by İMSAD.

The association links the limited growth in the industry to the weaker foreign and domestic demand.

The weaker domestic demand was due to the slowing down in building activities and the earthquakes which hit Türkiye’s southern provinces in early February, said the report, adding that the construction activities contracted in foreign markets because of the tighter monetary policies.

The association expects urban transformation projects and spending before the local elections slated for March 2024 will give a boost to the construction sector.

The policies to be pursued by the Central Bank aimed at cooling the economy may adversely affect the construction industry in the second half of 2023, according to İMSAD.

On the upside, the association noted that the increase in the construction costs have started to slow in the first quarter with the headline costs rising 61 percent annually while materials costs are up 48 percent.

“With [the presidential and parliamentary] elections now over, expectations for the second half of the year are taking shape. New house and infrastructure construction works in the earthquake-hit areas already began and those projects are planned to be completed before the local elections, which will support the construction sector,” the report said.