Évosz Underscores Energy Price, Exchange Rate Exposure

Construction

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Hungarian building material companies and general contractors priced in the impact of the war in Ukraine and supply issues in the first half of the year, but unpredictable changes to energy prices and the forint/euro exchange rate "remain a vulnerability," professional association Évosz said yesterday, according to novekedes.hu.

Évosz noted that spending on energy accounts for around one-quarter of the building material industry's input costs, although the rate is higher for producers of cement, tile, bricks, and some insulation, despite investments in up-to-date, energy-saving production technology.

General contractors, who get 48% of the building materials they use from imports, are exposed to the HUF/EUR exchange rate, Évosz said.

It added that even a "slight" weakening of the forint could result in a "significant" increase in prices in the construction sector.

The association said that efforts to retain skilled workers and engineers are expected to raise construction n industry companies' costs further. It also highlighted issues on the demand side as state and local councils have postponed a "significant volume" of investments and households have "reached the limit" of their ability to finance energy-savings renovations.

Évosz said local and foreign investors who have counted on state subsidies till now would appreciate "other state cooperation," too.

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