Monthly construction inflation continued to decline in some parts of Argentina in March, but could benefit local infrastructure companies in the short term as industry activity plummets due to paralyzed public works projects. would be low.
In the case of Cordoba, construction inflation reached 4.86% in March, significantly lower than February's 11.92%. The annual inflation rate was nearly 246% last month, according to the state statistics bureau.
In Mendoza, local construction association Red Edificer reported that costs in the province rose 1.54% in March, slowing from February's 3.33% growth. The group does not report annual statistics, but highlighted that the cumulative inflation rate reached 13.2% in the first quarter, down from 19.3% in the first quarter of 2023.
Meanwhile, in the Buenos Aires metropolitan area, which includes the federal capital and 24 surrounding municipalities, monthly construction inflation accelerated to 8.1% from 6.4% in February.
However, this is still lower than the peak of 30.1% seen in December and marks the second consecutive month in which the monthly variation has been below 10%, according to national statistics agency Indec.
The annual inflation rate in the Buenos Aires metropolitan area was 264%, with a cumulative value of 32.9%.
The mass shutdown of public works due to President Javier Millei's fiscal austerity measures has sharply reduced the activity of local infrastructure companies and caused material sales to plummet.
Construction activity fell by 24.6% in February compared to the same month last year, and by 23.1% in the first two months of this year. March numbers have not yet been released.
Asphalt sales have been the hardest hit, dropping 64.9% year-on-year in February alone, as hundreds of road construction projects have been canceled due to lack of funding.
The only item whose sales increased in February was paint, which rose 2% year over year.
In response to this situation, the Camarco Chamber of Construction declared a nationwide state of emergency in February.
According to a report in the daily La Gaseta, Camarco's Tucuman branch is drafting a PPP plan that will be submitted to the state government later this week, which includes housing projects as well as loan and tender proposals. It added that it would be included.
Even if the text is accepted by the state government, it could introduce its own changes, and the plan would also need to be passed by local legislatures before it can be implemented.
Meanwhile, in the state of Neuquén, the government is seeking approval for a US$500 million bond issue, of which US$350 million will be used to restart public works.
Parliament is scheduled to vote on the bill on Thursday after it is approved in committee, local newspaper Minut Neuquén reported.
According to Governor Rolando Figueroa, Neuquén has more than 400 projects currently canceled due to a lack of federal funding.