The quality of the TMT bar is an essential factor as this is the backbone of any construction. As an important component of construction, the price fluctuation of TMT bars may impact the construction cost. The contractors pay the TMT bar price today may change the next week or even the next day. This could be a challenge for many contractors as they have to estimate the cost of the project based on guesswork and experience.
The price of TMT bars varies due to the uncertainty of some key factors, such as transportation, raw material cost, etc. In this article, we will explain the reasons for the fluctuating price of TMT bars to help you estimate project costs better.
You may find the TMT bar price today cheaper compared to last week, and vice versa. That is because the manufacturing cost of TMT bars fluctuates based on a few key factors as mentioned below.
The transportation cost of carrying the raw materials and delivering the bars plays a significant role in determining the price of TMT bars. The transportation charge again depends on the fuel cost and distance. If the raw material needs to be delivered covering a long distance then the manufacturing cost will be high. Similarly, the increased price of fuel may increase the price of raw materials as well as the TMT bar price today.
This is quite obvious that raw material costs will influence the final cost of the TMT bars. Raw material cost is variable as the supply of raw materials varies from time to time due to unavailability and demand. You can get an idea of bar price fluctuation by keeping an eye on raw material prices.
The manufacturing process of TMT bars involves high heating and fast cooling. These procedures require a lot of energy and fuel. That is why a fluctuation of the fuel and electricity costs influences the TMT bar price today.
Like any other product market, TMT bar prices are influenced by the demand and supply ratio. That means the TMT bar price today is determined by the total demand in the market and supply of TMT bars.
Frequent fluctuation in the TMT bar price is one of the major concerns of contractors as the project cost also changes with it. A sudden increase in TMT bar price today can impact the total project cost and final profit.
The construction cost fluctuates due to the cost of TMT bars which is a concerning factor while calculating construction costs and allocating the budget. However, creating a separate fund for cost fluctuation will be helpful.
Sometimes sudden changes in TMT bar price today can exceed the budget for it and excess spend can interrupt the cash flow of the project. This price-changing factor hit hard the small contractors as they have a tight budget and may not have the budget to handle sudden changes.
Due to the fluctuation and sudden increments in TMT bar prices, the project’s profit may turn into losses. The best way to handle this situation is to add a buffer amount while calculating the project cost for a quotation.
TMT bars can not be skipped in any construction, and their price happens to be a big chunk of the total project cost. That is why a little change in the TMT bar price today can impact the project cost and profitability. However, this price fluctuation can not be avoided as it happens due to practical and obvious reasons.
