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On-site Wastewater Accreditation Program a mark of quality
Precasters who manufacture on-site wastewater tanks will now have a quality assurance stamp of approval. The NPCA Board of Directors approved the introduction of the On-site Wastewater Accreditation Program starting April 1.

Under the new program, manufacturers who apply for accreditation will receive an inspection from an independent third-party engineering firm. The inspection will review all production methods related to the manufacture of on-site wastewater tanks. Precast plants that pass the inspection will then be accredited through NPCA.

“What this means is that precasters who make wastewater treatment products will have a nationwide quality assurance program to ensure end-users that their tanks are manufactured under strict quality standards,” said Ty Gable, NPCA president. “We know that precast concrete tanks when manufactured properly are by far the best solution for on-site wastewater treatment. This program will give municipalities, commercial developers and homeowners assurance that the precast concrete tanks they are purchasing comes from a quality manufacturer, will be long-lasting, structurally sound and watertight.”

NPCA will market the program throughout the United States to municipalities, specifiers, regulators, developers and homeowners. The program gives the industry a visible symbol that accredited precasters take quality seriously and are not cutting corners in the manufacture of products that go into the ground and may be unseen for decades, Gable said. “The plastics and fiberglass industries do not have a comparable program,” he said. “Once instituted, this program will put to rest the unfounded claims by inferior materials of the suitability of precast concrete for on-site wastewater treatment systems.”

The basis for the program will be the 5th Edition of the NPCA’s “Quality Control Manual for Precast Concrete Plants.” NPCA’s 253 certified plants will receive the accreditation at no cost if they manufacture on-site wastewater products. NPCA members who are not certified can apply for the On-site Wastewater Accredit ation Program at a discounted rate of $1,995. Cost to nonmember companies is $3,500.

Find out more about Frequently Asked Questions here.

2005 Precast Industry Survey
The first-ever Precast Industry Survey is now available.

Results from 163 participating companies (representing 262 plants) are narrowed down into general statistics by region on cement consumption, concrete production, profit margins, sales per employee and more. This report gives the general consensus on competitive threat within the region and insight into the sales mix by company size and by number of employees.

The report is $250 for NPCA members and $500 for nonmembers and will be provided either on a CD or as a PDF. Visit www.precast.org or call (800) 366-7731 for more information.

Precast Forecast: More of the Same?
For precasters heading into the busy season, it’s a good news-bad news scenario. First the good. The U.S. highway bill that passed last fall may bring major new government transportation infrastructure projects online throughout the United States this year. More good news. The United States and Mexico have settled their 16-year-old trade dispute on cement, which decreases the tariff on Mexican cement from $26 to $3 per metric ton and will allow another 1 million tons of Mexican cement into the country this year. The tariff will end and the market will open completely in three years.

Now the bad news. Material prices that increased throughout 2005 will likely not decrease this year. Steel prices look like they will settle in at a high level after spiking sharply in 2004 and rising again in 2005. The steel market remains volatile, however. More bad news. While the trade agreement with Mexico will eventually open up the market, for 2006 the effect on supply may be limited to Southern states in close proximity to Mexico and the addition of new Mexican cement will likely not have an impact on price.

“We have made important progress in the trade area which will help us long-term, and we have a new highway bill, which means additional projects in the pipeline, but the margins are still as tight as ever,” NPCA president Ty Gable said. “If you’re in the precast industry, it is critical to know your costs, to know how to control your costs and to know how to produce superior quality products with a minimum of waste.”

Economists looking at the broader construction industry would agree. At a February economic forum hosted by AGC and other trade associations, Ken Simonson, AGC chief economist, said that materials costs, highway construction and Hurricane Katrina rebuilding in the Gulf Coast region are the topics to watch in 2006.

Simonson addressed what has become a key question heading into summer in recent years: “What is the cement outlook?” Answer: “Expect cement shortages to show up even earlier in 2006 than in 2005,” Simonson said, blaming the unseasonably warm winter.
“There has been an exceptional amount of construction activity throughout parts of the country this winter. That’s certainly good news for an industry that tends to have seasonal ups and downs,” Simonson said. “But typically, cement importers and manufacturers use this time to build up stockpiles.” Historically, these reserves fueled rampant construction activity after the first sign of spring. Precasters and other industries dependent on cement may find some supplies tightening before the flurry of summer 2006 construction starts.

If you can obtain cement beyond your allocation, don’t look for any price breaks, Simonson warns. In 2005, cement prices increased by 12 percent. “This year the increases will be just as great or perhaps a little greater, because demand for concrete from the highway and the nonresidential building industry is going to keep growing,” he said.

This is the first year in many when stalled highway projects can once again resume. Simonson said highway builders are grateful for passage of the Safety, Accountability, Flexible Efficient Transportation Equity Act (SAFETEA-LU), but he warned that highway bill funding may spoil before the bill’s five-year expiration date. “We’re starting to see a lot of attempts to diversify funding sources, whether it’s selling off toll roads or inviting in private highway builders,” Simonson said. For example, in Indiana, the Indiana Toll Road is planned for sale to an Australian-Spanish consortium for $3.85 billion, money the state says it plans to invest in highway improvements.

“The traditional highway funding sources are just not expanding enough to cover the costs of needs and higher materials costs, so I’m worried about highway construction beyond 2006,” Simonson said. In the federal budget released Feb. 6, projections on highway trust funds showed the highway account would run out of money by fiscal 2009, Simonson said.

So long-term prospects for highway work are uncertain. Sound familiar? Both Simonson and Carliner agree unanimously that the value of transportation infrastructure will be a key issue in 2006. “We’ve seen increasing strain on freight transportation networks from coast to coast and in between,” Simonson said, referring to post-Katrina shipping needs. “I think that all of our forecasts for price increases and avoiding shortages really depend on a transportation system that is operating at maximum efficiency. As we’ve learned from the hurricanes and also from the flooding in Southern California a year ago, and many other localized events, it doesn’t take much to disrupt transportation and cause shortages and price spikes for materials.”

Gable said success in the short term for precasters depends on understanding and controlling costs and adding value to their products. It is also vital to keep your eye on the horizon to be prepared for material shortages, labor shortages or anything else that could disrupt production. “The key is to always be able to deliver a quality product to the job site on time – especially when your competitor can’t,” Gable said. “When precasters plan ahead of rising material costs and delivery hiccups, they ultimately come out ahead.”

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