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Industrial buildings fuel construction sector growth

The volume of construction output was 23.8% higher in September 2017 than the low base a year earlier, a first release of monthly data from the Central Statistical Office (KSH) showed on Monday. Output increased in both main groups of construction: by 22.9% in the construction of buildings, and by 25.4% in civil engineering works.

Based on seasonally and working day-adjusted indices, construction output fell by 3.8% in September compared to the previous month, following a 9.8% monthly rise in August.

Growth in the construction of buildings in September was primarily the result of the construction of industrial buildings and, to a lesser extent, sports facilities, as well as educational and residential buildings, the KSH said. In the case of civil engineering works, in addition to the low base factor, production grew as a result of road, railway and utility construction works.

In absolute terms, construction sector output reached HUF 270.5 billion in September, at current prices.

The order stock at the end of September was up 119.5% from twelve months earlier. The order stock climbed 33.6% in the building segment, and was up by 177.7% in the civil engineering segment.

The new order volume rose 130.0% from a year earlier. New orders were up 46.6% in the building segment, and rose 211.7% in the civil engineering segment. New contracts were concluded mainly for the construction of industrial buildings and, to a lesser extent, homes and hotels, the KSH noted. Growth in civil engineering works was the result of contracts signed for transport development, as well as public utility developments.

In January-September, compared to the same nine-month period of 2016, the volume of construction output was up 27.0% year-on-year.

In January-September, construction producer prices rose by 4.7% compared to the same nine-month period of the previous year.

Construction output figures for October 2017 will be published by the KSH on December 15.