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Cement pinch not causing road pain

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A cement shortage caused by a building boom in Asia has had ripple effects across America and California, but so far it hasn't delayed any road projects in the county.

Some contractors said prices spiked in the first quarter of this year but have started to fall a bit.

"When you have a limited supply and high demand you're going to see high prices," said David Anderson, a spokesman for the California Department of Transportation. But he said prices have leveled off. "The major increases have already happened," he said.

After years of relatively stable prices, the department saw the cost of structural concrete -- the sturdier stuff used in bridges and interchanges -- jump to $828 per cubic yard in the first quarter of this year, up from $337 per cubic yard in the last quarter of 2003.

In the second quarter of 2004, the price for structural concrete fell to $340 per cubic yard, Anderson said, calling the first-quarter number an anomaly. The second-quarter price for structural concrete was more in line with ones seen during the last few years, he said.

A building boom in China has put a crimp on the supply available to the United States, where demand for cement outpaces production. Imports accounted for about a fifth of U.S. cement consumption in 2003.

Anderson said no Caltrans projects had been delayed as a result of the higher prices or tight supply. The price spikes did increase the cost of some projects, but Anderson did not immediately have estimates on how much extra the department shelled out for concrete.

Tom Rademacher -- president of FCI Contractors, the Southern California division of Colorado-based Flatiron Construction -- said that prices seem to have leveled off recently. During the last three months, his company saw prices increase 6 percent to 10 percent each month.

FCI Contractors worked on a number of North County transportation projects, including the completion of Highway 56. The group will build portions of the new Sprinter line and some car-pool lanes on Interstate 15.

Rademacher said his company, which has offices in Vista, isn't losing business but has been forced to take more risks. There's no guarantee, for instance, that the suppliers they choose will be able to keep prices steady for 12 to 18 months, he said. That means his company could pay more to finish multi-year projects.

"It becomes more of a seller's market as opposed to a buyer's market," Rademacher said. Just getting cement has been a challenge, he added. But he said it's impossible to tell how much the cement shortage will cut into his bottom line. Not all road projects use a lot of the white stuff, instead relying more heavily on asphalt. Cement accounts for anywhere from 1 percent to 15 percent of his company's total costs, he said.

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