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SINGAPORE: Some contractors are taking no chances with news that Vietnam is banning sand exports to Singapore on worries that the pace of extraction would damage the Mekong Delta.
One company, Alliance Concrete, has been in talks with quarry operators to invest in technology that will make a substitute for sand. It is looking to rope in partners for the initiative to ensure a more diversified source of building materials.
Alliance Concrete is one Singapore contractor that is shielding itself against any negative effects from Vietnam's ban on sand exports. It is building up its own stockpiles which it believes will last over a month.
Many contractors have generally moved away from fixed cost contracts to those with clauses that will allow them flexibility to negotiate more competitive prices when there are fluctuations in material costs. It is also looking for viable alternatives to sand.
The company is in talks with quarry operators to invest in technology and machinery that can process a by-product of granite which can be used as a partial substitute for natural sand.
Goh Siew Huat, chief executive officer, Alliance Concrete, said: "The specially manufactured sand is a little bit more expensive but I believe in time to come in Singapore, (it) will be the solution."
Alliance said talks have been positive so far with at least one operator already committing to investments.
The ban by Vietnam on sand exports came a few months after a similar move by Cambodia and two years after Indonesia. The industry appears more prepared this time for potential disruptions in sand supply.
Views are divided on whether Vietnam's ban will push up sand prices in Singapore. Alliance and the Singapore Contractors Association said there is nothing to worry about because Singapore has many sources such as Myanmar, China, and Thailand.
But the Ready-mixed Concrete Association has other views.
Dr Sujit Ghosh, president, Ready-mixed Concrete Association, said: "Sand is required in the production of ready-mixed concrete and the demand of ready-mixed concrete is quite buoyant and construction is moving up.
"So it may have some pressure on the prices of sand and also the prices of sand substitutes we use in concrete. I cannot put any numbers to that, so we'll have to see."
Alliance said there are some expectations that demand for construction for materials will pick up as property development projects kick in next year.
According to Alliance, the construction of the Marina Coastal Expressway, which is scheduled for 2010, is expected to raise demand for concrete by about 10 per cent.
The cost of sand has been stable over the past few months at around S$30 per tonne, with concrete at S$80 per cubic metre. This is less than half the peak in the aftermath of Indonesia's ban two years ago.
The Real Estate Developers Association of Singapore (REDAS) declined to comment, saying that this issue would be more of a concern to contractors and subcontractors. - CNA/vm
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