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Construction Activities Remain Poor due to Low Demand
by Philippine Resources - March 22, 2021
Building and construction activity remains poor due to low demand, as shown by a nearly 50% decrease in the value of building works in the fourth quarter of 2020.
According to the Philippine Statistics Authority's Construction Statistics from Approved Building Permits, the total value of constructions fell nearly 47% to P63 billion in the fourth quarter of 2020, down from P118 billion in 2019.
In addition, the figure was lower than the P67.7 billion recorded in the third quarter of 2020. This is despite the fact that the number of building projects fell to 31,026 in the fourth quarter of 2020, down from 39,242 in the same quarter of 2019.
Despite the economy's gradual reopening since last year, demand for construction has yet to resume because workers' capacity remains restricted.
Residential construction projects accounted for 71 per cent of all constructions during the time, with 21,892 overall. This form of building, the majority of which were single-family homes, shrank by 20% each year.
In addition, the value of residential construction fell by 41% to P32.6 billion.
Non-residential projects, mostly commercial structures, have decreased by 29%. At that time, it accounted for 15% of all constructions.
During that time, the value of non-residential constructions fell by 53.3 per cent to P26 billion.
The rest were changes to existing buildings, such as extensions, alterations, and repairs.
Calabarzon continued to have the most construction activity, with 6,368 constructions accounting for 21% of the total. Ilocos and Central Luzon came in second and last, respectively.
However, the National Capital Region, with P13.6 billion in revenue, accounted for 22% of the total.
Philippine Resources - November 10, 2020
Cement Demand Expected to Rise Next Year
With infrastructure-building activities picking up pace now in spite of the pandemic, Philippine demand for cement is seen to rise next year, similar to how it performed in 2019. According to Nabil Francis, president and chief executive officer of Republic Cement & Building Materials, a joint venture between Aboitiz Equity Ventures (AEV) and CRH plc. “When it comes to market demand, our forecast is that in 2021 we will get back to 35 million tons for the Philippine market, which is more or less the level in 2019.”He said that this year, however, he expected local cement demand to contract by 15 per cent, as opposed to a 9-per cent growth before the pandemic hit. While COVID has pushed back the industry for three years, Francis sees the cement industry being pushed back for a year, saying that there might be a V-shaped recovery. In the third quarter, he noted that the industry was already starting to rebound with an estimate of a 7-per cent year-on-year growth after builders replenished their cement stocks. In the case of Republic Cement, he said that all of his six plans are already running but with the standard safety protocols. Francis that the next year’s demand on infrastructure would be bullish while other sectors such as the individual house-building may lag. In the first nine months of 2019, Republic Cement had an income of P 400 million to AEV, which is 37 per cent lower year-on-year as COVID-19 dramatically put a halt to construction activities, especially during the quarantine measures. He said that their company was just commissioning new equipment when the pandemic hit but is positive that its production will grow to close to 9.7 million tons due also to the government’s Build-Build-Build program. He added, though, that local cement was threatened by imported cement. Francis said, “Our vision remains intact for the future: to be the best-managed company of the industry and ramp up new equipment. We are remaining optimistic for next year.”
Philippine Resources - January 09, 2021
Estrella-Pantaleon Bridge Opens to Public in Q2 2021
Motorists will soon experience the newly-renovated Estrella-Pantaleon Bridge.According to Public Works and Highways Secretary Mark A. Villar, the bridge which links Barangka Drive in Mandaluyong City and Estrella Street in Makati City will soon open in the second quarter of 2021. He said that the construction of the bridge is now 72% complete and is 8% ahead of schedule. Among the features of the bridge that have been completed include all bridge substructure works on abutments on both sides, the V-shaped piers for the main bridge and the Makati approach. In addition are concrete pouring works for the first lift of box girder for the approach bridge in Makati and the concrete pouring four segments of prestressed concrete girder in Mandaluyong side. Secretary Villar has pushed for the speedy construction of this bridge and has done all measures conducting inspection, resolution of technical issues, and quality standards and safety from time to time - all under the guidance of Undersecretary Sadain.Undersecretary Sadain said that the DPWH UPMO Roads Management Cluster 1 is now doing work on the remaining civil works that covers formworks and rebar installation in two (2) segments of prestressed concrete girder in Mandaluyong side and two (2) more segments in Makati side. He added that workers, in order to finish the bridge, will work on the second lift of the box girder for the approach bridge on the Makati side.Once the bridge is completed, traffic will ease as there would be more opportunities for motorists to take other routes.
Philippine Resources - November 03, 2020
SMC Plans to Build LNG Plant
San Miguel Corporation (SMC) has plans to build 2,550 megawatts of power facilities using imported liquefied natural gas to hit commercial operations in 2022. According to SMC President and Chief Operating Officer Ramon S. Ang, the project will be done in three stages at 850MW capacity each. The site is in Batangas, proximate to the existing 1,200MW Ilijan gas-fired power facility, and SMC Global Power Holdings Corporation is the subsidiary that advances this project to implementation. The plan is to offer its capacity in an exercise that power utility giant Manila Electric Company (Meralco) undertakes on its competitive selection process (CSP) for new power supply agreements. “The power generation group of San Miguel, we are now switching to LNG. We intend to build three lines of 850MW, so that’s 2,550MW,” Ang said. He added that the development blueprint is set for the targeted commercial operation date of the initial 850MW by 2022 - the timeframe when imported LNG begins to flow into the country. Ang said that SMC will have its own floating storage regasification unit (FSRU) to supply LNG to its own gas plants – and exploratory discussions with Batangas-headquartered engineering and gas firm AG&P are now being conducted. “All of that can be up and running in two years,” Ang said. “In 24 months, that plant will be up and running. Whether we win the Meralco bid or not, we will construct the first line of 850MW.” Ang said that the alternative off-takers could be the electric cooperatives, specifically those operating in the grids of Luzon and Visayas. According to him, the longer-term goal will double their capacity to 5,000MW, which can depend on the electricity demand gains. Ang also indicated that SMC is eyeing to replace their old coal plants with LNG-fed generating facilities, so that forced outages could be minimized.
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Philippine Resources - April 06, 2021
Philippines Unlikely to Fulfill China's Nickel Ore Requirements
Despite the resumption of many mining operations in the region, the Philippines is unlikely to fulfill China's nickel ore requirements, according to an S&P report. Philippine mined nickel production is expected to increase over the next five years, according to an S&P Global Market Intelligence industry survey, as producers aim to satisfy Chinese nickel ore demand. However, S&P analysts said, “We believe that legislation will remain a major hurdle for restarts and new projects, therefore the Philippines will be unable to meet Chinese nickel ore demand over our forecast period.” Three nickel mines in the world that had been closed due to the coronavirus disease in 2019 were reopened in 2020 when the government turned to the mining industry to help offset the economic effects of the disease (Covid-19). These restarts and demand from current mining facilities, according to foreign analysts, are expected to raise Philippine mined nickel output from 340,000 tonnes in 2020 to 550,000 tonnes in 2025. “However, we believe that existing environmental restrictions on Philippine mining will limit the scope for further mine restarts or additional production from new mining projects in the medium term,” S&P analysts said. “This will prevent the Philippines from meeting China’s nickel ore requirements in Indonesia’s absence, driving Chinese primary output down from an estimated 715,000 tonnes in 2020 to 490,000 tonnes in 2025.” The Philippine Nickel Industry Association (PNIA) previously reported that the country's nickel export value increased by P1 billion from January to September 2020, compared to P24 billion in the same timeframe last year. According to a survey from the Mines and Geosciences Bureau (MGB), the Philippine nickel industry produced 18.5 million dry metric tons (DMT) in 2020, down 14% from the previous year's 21.6 million DMT production. MGB stated that the lower output was primarily due to the increased community quarantine imposed by Covid-19 from March to May 2020, during which mineral product movement was restricted across the world. The increased performance in export value for the nickel industry, according to PNIA President Dante Bravo, was primarily motivated by demand increases in nickel prices. China's consistent demand boosted the world nickel price in 2020.
Philippine Resources - April 06, 2021
Forecasts for PH Development in 2021 Have Been Reduced
Fitch Solutions, a London-based think tank, has slashed its economic growth forecast for the Philippines this year, citing the return to tough lockdown measures in the wake of the COVID-19 outbreak, which is expected to dampen domestic investment in the short term. Fitch Solutions now expects the Philippines' actual gross domestic product (GDP) to rise by 5.8% this year, down from the initial estimate of 7.6%, due to the government's capital spending push being derailed. “The surge in COVID-19 cases in the Philippines in March and lockdown measures imposed reflect the continued risks to the archipelago’s economic outlook,” the think tank said in a research note dated April 1. The government has reimposed curfew policies in Metro Manila and neighbouring provinces, affecting an unprecedented 24 million inhabitants, as it struggles to control the pandemic. Given the continuing increase in cases and the long-term effect on hospital capacity, Fitch Solutions expects the lockout steps to be extended beyond two weeks. “The likelihood of further outbreaks in other regions remains high and given the slow vaccination rollout in the country (less than 1 per cent of the population has been vaccinated as of end-March) we believe the Philippines’ recovery will continue to be hampered by the pandemic,” Fitch Solutions said. Regional outlook The think tank went on to say that its new estimate of 5.8% also had downside risks. It stated that its forecast for a moderate recovery this year was based on the assumption that domestic demand would steadily improve and the government's investment plans would be realized, resulting in a sharp increase in domestic activity. “However, the slow vaccine rollout and recurrent difficulties in containing outbreaks look set to stall the recovery further,” it noted. A survey of economists in the Asean-5 and India found that the Philippines' growth projection was 5.2 per cent, down from 5.9 per cent in the previous poll last December. Although Asian countries that carried out mass vaccination earlier, such as India, Indonesia, and Singapore, saw their near-term economic prospects boost, gradual inoculation tempered economists' growth aspirations for the Philippines, according to a poll released on Monday by the think tank Japan Center for Economic Research (JCER). Economists following the Philippines predicted that GDP will contract by 3.8 per cent year on year in the first quarter, up from 0.7 per cent a year before. GDP will rise 8.4% year over year in the second quarter, 5.6 per cent in the third quarter, and 4.5 per cent in the fourth quarter due to base effects from last year's low. Malaysia and Thailand, including the Philippines, have weaker growth forecasts for 2021. “Most economists see the rollout of COVID-19 vaccination as one of the most significant positive developments over the last three months and all three upward-trending countries have rolled out vaccinations relatively sooner. This may have improved economists’ outlooks. Delays in vaccination and the spread of COVID-19 variants are listed as factors that might damage the economies,” JCER said. Top concerns Faster dissemination of COVID-19 variants and delayed vaccination, or "corona shock," were described as top economic issues in the Philippines, but higher inflation was also identified as a major threat to the country's recovery from the pandemic-induced recession. According to analysts, headline inflation will average 4.5 per cent in the first quarter, 4.8 per cent in the second, 4.7 per cent in the third, and 4.2 per cent in the fourth quarter, averaging 4.5 per cent in 2021, way above the target range of 2-4 per cent. With a 6.1 per cent increase, Singapore is forecast to lead economic growth in the Asean-5 this year, led by Malaysia's 5.3 per cent and Philippines' 5.2 per cent. According to the JCER report, India will rise at a higher rate of 11.2 per cent in 2021. Economists predicted that the Philippines' average GDP growth will be 6% in 2022, up from 5.8% in December but still below the government's goal.
Philippine Resources - April 06, 2021
Estrella-Pantaleon Bridge Expected to Open in June 2021
The Department of Public Works and Highways (DPWH) is concentrating not only on the civil work’s development of the Estrella-Pantaleon Bridge Project but also on keeping the workplace secure and clean. DPWH Secretary Mark A. Villar said, "that at 86 per cent and with just a few more days to fully complete the new Estrella-Pantaleon Bridge, we are mindful that a single case of COVID-19 in the project can lead to an interruption, if not total work stoppage" Secretary Villar recently issued revised guidelines in Department Order #30 for the implementation of ECQ, MECQ, GCQ, and MGCQ infrastructure projects, both public and private, during the public health crisis. "Although the bridge project is being rushed for completion in June 2021, it is critical that construction firms be proactive rather than reactive in dealing with the increased risk of illness from COVID-19," Secretary Villar added. Emil K. Sadain, Undersecretary for Unified Project Management Office (UPMO) Operations, and UPMO Roads Management Cluster 1 Project Manager Benjamin Bautista checked the physical progress of the bridge project on Monday, April 5, 2021, and the contractor's compliance with protocols that cover prevention, detection, and rapid response to maintain construction work continuity as workers who have been living in the barracks resume work after the Lenten season. “Let’s get to work healthy to get the job done”, Undersecretary Sadain reminded the contractor China Road and Bridge Corporation citing the current health situation, particularly in the NCR Plus bubble. In his report to Secretary Villar, Undersecretary Sadain reported that the project is more than 12% ahead of time, having completed all bridge substructure works for abutments A and B on both sides and piers of the Makati approach bridge; the V-shaped piers for the Main Bridge; concrete box girder for the approach bridge; and the V-shaped piers for the Main Bridg; and two (2) prestressed concrete box girder segments using the traditional approach. Post-tensioning and grouting works, formworks and rebar installation for the closure section in the side spans, formworks installation for the 2-meter closure section in the main bridge span, and preparatory works for approach road construction on both sides are now the focus of bridge construction activities. The new 506-linear meter bridge, funded by China and introduced by the DPWH UPMO - Roads Management Cluster 1 (Bilateral), would have a diameter of 21.65 meters, capable of four (4) lanes instead of two (2), and three-meter sidewalks on both sides. The P1.46 billion new Estrella-Pantaleon Bridge, which is scheduled to be completed in the second quarter of 2021, will handle 50,000 vehicles a day and minimize travel time between Mandaluyong and Makati to 12 minutes. The bridge will connect Estrella Street in Makati to Barangka Drive in Mandaluyong, helping to relieve traffic congestion on EDSA by providing an alternative route for motorists.