DRAWING from the national granite stockpile could be quite costly for contractors, who are facing a shortage from Indonesia that has led to construction delays.
The Building and Construction Authority (BCA) is charging more than the market rate for granite, according to a circular sent out to contractors on Tuesday that was obtained by The Straits Times.
Granite from the national stockpile costs $30 per tonne plus goods and services tax (GST) this month, the circular said. Contractors told The Straits Times yesterday that the average market rate was about $25 per tonne.
The Government's price will rise even more to $50 per tonne plus GST next month if necessary to keep from drawing down the stockpile that month "depending on the developments", BCA added.
"Any form of hoarding of granite shall not be tolerated," the BCA said, adding that it encourages firms to "continue sourcing for alternative supply of granite".
It said in a press release on Tuesday night that it would release granite from the national stockpile to help ease the shortage, starting yesterday.
Granite aggregate - small pieces of crushed stones - is a key component in making concrete.
Mr Benjamin Tan, managing director of Ho Lee Construction, said he plans to submit a request to draw from the national stockpile. Ho Lee is building three private projects that need concrete, including the Heron Bay executive condominium at Upper Serangoon. Mr Tan added that he was worried about market prices going up.
Granite suppliers from neighbouring countries may also raise prices to $30 per tonne this month, he said.
However, Straits Construction general manager Kenneth Loo said yesterday that the temporary shortage of granite would probably not last very long.
"All the infrastructure is in place to import granite from distant sources like China. Now it's just a matter of activating that and ramping it up."
He said his firm has been "minimally" affected by the shortage so far.
Indonesia was a major supplier of granite aggregate to Singapore, but no granite aggregate has been shipped from Indonesia since Jan10 as part of a move by Jakarta to ban the export of various minerals globally.
Other sources of granite include Malaysia and Vietnam, contractors said.
Main contractors have to apply to BCA for the volume of granite they need for their projects, according to the BCA circular.
They then have to collect the granite from the stockpile at Pulau Punggol Timor once the request is approved.
A BCA spokesman yesterday told The Straits Times that it has received some inquiries regarding the release of granite from the national stockpile, but has not received any applications yet.
It declined to disclose the size of the stockpile.