[Asia Economy Reporter Kim Jong-hwa] It is estimated that the cement input cost for an apartment with a supply area of 99㎡ and a sale price of 436.79 million KRW is 1.7 million KRW.
According to the Korea Cement Association on the 12th, based on the standards used by the Korea Land and Housing Corporation (LH) to calculate apartment construction costs, the nationwide average sale price for a 99㎡ (30-pyeong) apartment as of the end of June was 436.79 million KRW.
About 21 tons of cement are used per apartment unit. Typically, 0.25 tons of cement are used per 1 cubic meter (㎥) of ready-mixed concrete (remicon), and approximately 2.39㎥ of remicon is required per pyeong. Therefore, about 0.6 tons (2.39㎥ × 0.25 tons) of cement are used per pyeong, meaning approximately 18.5 tons (31 pyeong × 0.6 tons) of cement are needed for one apartment unit. Additionally, about 2.07 bags (40kg per bag) of finishing cement for flooring and other finishes are used, totaling 2.5 tons. Adding these together, the total cement input is about 21 tons (18.5 + 2.5).
Reflecting the current cement price (85,000 KRW per ton, market price), the cement purchase cost is approximately 1.7 million KRW. The price per pyeong (3.3㎡) is about 58,200 KRW. Considering that the average sale price per pyeong for private apartments surveyed by Statistics Korea in June was about 14.55 million KRW, the cement purchase cost accounts for only 0.4%, according to estimates from the cement industry. Even after reflecting the average 13% price increase from the 1st of this month, the purchase cost proportion increases by only 0.05% relative to the total sale price.
The cement industry also stated that the 2022 construction order forecast by the Construction Industry Research Institute is 215 trillion KRW, and since the cement industry's share of the construction industry is only 1.6%, claims that cement price increases negatively affect price stability and justify raising apartment sale prices lack persuasiveness.
A cement industry official said, "Claims from the remicon and construction industries that further cement price increases would negatively impact the construction market in the second half of the year and government price stabilization policies are not true," adding, "Even after reflecting additional increases, the cement procurement cost accounts for only 0.05% of the total sale price, which is a negligible increase of 200,000 KRW in amount."
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