Reinforced steel bar scheme being bent all out of shape
Authorities did not properly utilize prefabricated rebar products from tendered contractors, supposedly causing them to suffer up to HK$50 million in losses over the past two years.
In view of an aging workforce in the construction sector, the government launched the prefabricated steel-reinforcing bar products scheme three years ago.
Under its terms, four approved construction yards could supply prefabricated rebar products for use in government projects. And rebar products produced in the yards would be sent to construction sites for use.
The four yards are operated by three companies - Golik Steel (HK), SW Construction and VSC Construction Steel Solutions.
Pang Tak-chung, chairman of Golik, which operates two of the four approved yards, said Hong Kong used over 1.3 million tonnes of steel every year, and prefabricated rebar products are helpful as many bar benders are over 60 years of age.
However, only 10 to 15 percent of rebar products used in tendered public projects were assigned to them, causing some yards to suffer losses of up to HK$50 million in the past two years.
Some foreign enterprises had withdrawn from the Hong Kong market, leaving only local companies to run the yards, Pang added.
Although the Legislative Council has approved a number of large-scale construction projects and more construction works are scheduled over the next decade, Pang said his sector may not be able to share the benefits due to the government's reluctance to utilize many innovative technologies.
If the business situation did not improve, Pang added, his company may close one of its two yards.
Lau Chi-chiu, executive director of yard operator VSC Construction Steel Solutions, said his company lost tens of millions of dollars a year.
VSC had put in resources for making prefabricated rebar products since 2016, he said, and it had cooperated with a Singapore company.
But the Singapore company had quit as there were not enough construction projects for the products.
He also said more private construction projects use prefabricated rebar products.
SW Construction sales executive Alex Pong said many construction sites in Hong Kong still use on-site rebar because building plans change at sites.
But he believes the use of off-site prefabricated rebar products will increase with high-tech developments.
Ambrose Linn Hon-chung, chief executive of the Hong Kong Construction Materials Association, hoped the use for prefabricated rebar products could increase to 40 percent for all construction projects in Hong Kong.
"Otherwise, I worry that all yards could be closed in three years," he said.