Blame tariffs. Blame Tucson’s unending growth. Blame China’s industrial ramp-up into an economic superpower but however you look at it cement is getting harder to find in Tucson Arizona. Home Depot, 3925 W. Costco Drive, faces regular shortages, said Victor Lindzy, the store’s gardening and backyard manager. Customers are not happy. "They are not really too receptive to it," Lindzy said. "It’s their day off, they have a big project planned and they can’t believe we are out of cement."
Lindzy’s store has been barely able to keep up a supply, he said, but other Home Depots are rationed as few as two pallets of cement a day, about enough to lay three patios. Branch got lucky and grabbed one of the last pallets of cement at a South Side Home Depot. More than 200 bags of cement - 15 pallets - are needed to build a home, so Branch said he now must rethink his business strategy because his rammed-earth walls are three percent cement. The cement shortage is edging up home prices, forcing rationing, scrambling old cost forecasts on road projects and threatening concrete subcontractors with a bleak future.
The price of concrete has risen from $64.80 per cubic yard in January to $70 now. That translates into a $520 increase to the cost of a new home in the first seven months of the year. Ten years ago, a cubic yard of concrete was $35. So the slow rise in concrete prices has added $3,500 to the cost of building the typical home, which requires 100 cubic yards of the material.
The federal government imposed a $57-per-ton tariff on Mexican cement as part of the North American Free Trade Agreement approved in 1994. The tariff was meant to protect American firms by preventing Mexican firms from flooding the American market with low-cost cement. Instead, the tariff is hurting the businesses relying on cement to make concrete, said William Hardy, owner of W.J. Hardy Concrete. "It is absolutely destroying this business," said William Hardy, owner of WJ Hardy Concrete. "There are days I have to tell people to stay home." Last month, Hardy had to tell his 260 employees to stay home because he didn’t have any product to pour.
Yet, the Arizona Portland Cement factory just north of Tucson churns out millions of tons of concrete a month. However, given the explosive growth of Tucson and Phoenix, that isn’t enough, said Craig Starkey, sales manager of Arizona Portland Cement. "The demand is way higher than our ability to produce," he said. So Arizona Portland is forced to ration, Starkey said.
Through May, 3,642 housing construction permits were issued in the Tucson area, up from 3,471 last year. During ordinary times, imported cement would make up for the demand Arizona Portland could not meet and Asian suppliers who once shipped their products to meet American demand are now shipping cement to China.