Friday, May 21, 2004 | 10:58 a.m.
A cement shortage that has gripped the Southeast United States has moved to Southern Nevada, leaving local companies with a decreased cement capacity and causing some to allocate the building material and shorten their workweeks.
Southern Nevada, which used an estimated 1.65 million metric tons of cement last year, is dependent on out-of-state and overseas cement suppliers. Cement is an ingredient in concrete, used to build everything from houses to highways. The valley used just under 6 million cubic yards of concrete last year, industry group the Portland Cement Association reported.
Last year the U.S. consumed about 107.5 million metric tons of portland cement, the technical name for the most commonly used cement, of which almost 19 million metric tons was imported. Cement consumption nationwide averaged more than 106 million metric tons during the past three years, the association reported.
There are several causes that have collided and are contributed to the shortage.
The booming Chinese economy has tied up bulk shipping, which has disrupted the flow of imported cement that traditionally filled the gap between domestic production and consumption. China and the Pacific Rim countries are a large supplier of cement to West Coast states, but with shipping fleets flowing toward China, there is a shortfall in ships available to carry product to the United States from Asia and Europe, the Portland Cement Association reported.
The recovering U.S. economy is creating record demand for cement, and a strong winter construction season that drew down cement inventories also is a factor.
In the West, regional transportation problems, such as a shortage of truck drivers and rail slowdowns, have hampered shipments to the Las Vegas Valley, local manufacturers said.
"I've been in business for 27 years, and I've never seen anything like this," said Bob Albano, vice president of Rinker Materials Nevada Inc. "I've gone through shortages, but never a shortage, a lack of imports, trucking and rail issues and have them all hit at one time."
Steve Hill, president of concrete supply company Silver State Materials, said cement suppliers have had to limit the amount of cement sold to local companies, creating a snowball effect. In some cases cement suppliers are limiting companies to the same amount of cement used last year -- or less.
"Las Vegas, Phoenix, all want to use more cement than last year, and they are forced to use a little less," Hill said.
In turn, some concrete manufacturers are reducing the amount of material sold.
For about three weeks, Silver State was limited to supplying customers just 85 percent of their orders. Since that time, the company has been able to ease up on the allocation.
Rinker Materials, one of the Valley's largest suppliers of concrete, has had to turn business away and is not accepting any new customers. The company, which employs 650 people, recently moved to a five-day workweek and is no longer open on Saturdays.
"We just don't have the cement to operate on Saturday," Albano said.
In Florida, Rinker Materials has gone from six-day weeks to four-day weeks. Florida was one of the states first hit by the cement shortage, industry groups said.
Steve Holloway, executive vice president for the Las Vegas chapter Associated General Contractors, said cement delivery delays and shortages have stalled some projects in the Las Vegas area.
"There have been a couple projects that have been held up a couple days because they weren't able to get cement delivered in a timely manner," he said.
Rumors that the cement shortage is causing a slowdown in Beltway construction are not true, but the shortage could hamper the project in the future, said Bobby Shelton, Clark County Public Works Department spokesman.
"We had to deal with a steel shortage and we could see a rise in (the cost) of cement/concrete product," he said. "It may impact future portions, but we haven't yet encountered such a shortage."
The county and state already have had to deal with a steel shortage that has caused prices to go sky high and threatened to slow down public works projects. The state Transportation Department and the state Public Works Board earlier this month said they will write into future contracts an "escalation clause" that will allow higher payments to contractors when the price of steel rises more than expected.
Albano said he is not bidding as aggressively, if at all, on highway work and other jobs because of the cement shortage.
"I will tell you, this is not short lived," he said. "This is a situation that will be with us for months and months to come."
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