Positive in more ways than one

Source: DUOL.hu 2022.10.12. 17:30

Photos by Martin Ihász

The drastic rise in energy prices is also challenging the construction sector. Some building material producers have even introduced quotas this year. Despite the difficult situation, ÉPDUKER is able to meet customer needs with a large stock thanks to its constantly expanding supplier relationships. We talked to Tamás Kiss, the manager of the Dunaújváros-based building materials dealer, about all this.

- Is there more interest and demand for property insulation? 
- The current situation is extraordinary, with energy prices having risen several times over and, from the economic operators' point of view, even the energy exchange rates have a huge impact on the prices of products. In addition, the State has also put the handbrake on, with payments being postponed indefinitely. All of this is also making insulation of buildings even more important. We have already noticed among the public that those who have savings are investing in insulation, partly to reduce their utility bills, and partly because the energy classification of a property has become a key consideration when buying or selling it, affecting its value by millions of forints. An average brick-built house is insulated with 15 cm of EPS Styrofoam insulation, which can reduce heat loss by about one-eighth. Obviously, if someone heats their property at 24 degrees instead of 21 degrees, there can be a 20 percent difference in loss. Otherwise, Hungarian households should accept that 21 is the ideal temperature, and in the West it is optimised at 19 degrees. Before the rise in energy prices, the payback on insulation was put at about 10 years. In the current situation, this period has been reduced to 5-6 years. 

- It is a long-term investment... 
- We are in a weather zone where, although we have not yet been hit by such severe cold, we are already feeling the extremes. That's why you need to prepare now by insulating your property, not only for winter, but also for the increasingly hot summers, because it doesn't matter how quickly your home heats up. New-build homes have requirements on what energy rating they should have, how much renewable energy they should install, from solar panels to heat pumps. This is now being reflected in second-hand houses, with spiralling utility bills, energy conservation is a burning issue and is making it more cost-effective to insulate properties. 
- What are the most popular types of insulation? 
- There is the already mentioned EPS, the white board material colloquially known as Styrofoam. It is the most widely used and also the most affordable. There is an improved version, which is a grey coloured graphite EPS material. It has about a 15-33 percent improvement in thermal insulation compared to the usual white-coloured sheets, is extremely lightweight and easy to apply. The advantage of polystyrene (EPS) insulation material is that it is not sensitive to moisture, and some types are highly water resistant. The third is mineral wool insulation, which is used in special places, has excellent fire-resistant properties and is a good sound and heat insulator. Where fire regulations dictate, this type of insulation is increasingly being chosen by those who are thinking long term and can afford it. It is a heavier material, it performs its function using a completely different methodology to EPS. Mineral wool can also be used for retrofitting insulation in adobe houses. There are also new insulation methods, such as PIR insulation, which is in fact an alternative to mineral wool. It is higher in price but just as light as EPS, has a fire resistance certificate and is easy to apply. It has the same properties while being up to half as thick, which means savings on cornice and tinsmithing work. We have now used it to insulate our warehouse. 

Is the construction weather dependent? 
- Since the construction of a house starts from the ground up, insulation and painting typically takes place in the fall or early winter. Except for rain, it can be done regardless of the weather. Only when insulating with graphite should care be taken to avoid hot sun, as the dark grey material can overheat and deform. This can be solved by applying the insulation in the early hours of the morning and immediately covering the structure with netting. 
- Are there enough supplies to meet the increased demand? How are the Russian-Ukrainian conflict and energy prices affecting the sector? 
- You don't think about it, and I wasn't fully aware at the time how much raw material and energy was flowing from Ukraine and Russia, not just to Europe but to the whole world. As energy prices have gone out of control, costs have also increased dramatically where gas is used in manufacturing processes, be it bricks, combustibles or even EPS. The price of bricks, for example, has gone up by a factor of two and a half, with no brick below a thousand forints. I would add that there are two manufacturers in Hungary, Wienerberger and Leier, which produce bricks in larger quantities. The former has not raised its price, but it does not take orders for production, the latter does, but at a high price. From January this year, all producers have announced quotas, because for them too, the supply of raw materials and energy is completely unpredictable. We have replenished our stocks, we are constantly expanding our network of contacts and we are fully prepared for the increased demand. I can say that we have a uniquely large stock in the county.

- Obviously we don't know how long this crisis will last, but how do you see it continuing? 
- The situation is completely uncertain, and the sabotage of the Nord Stream pipelines was yet another blow to the market. Producers are buying energy on the exchange with monthly quotas. Some of them are in a very good position because they signed up for a year and a half before the crisis and they may be paying the same price as a year ago. However, in general, the larger producers are trying to mobilise their position to be in a flexible position because of price elasticity. Unfortunately, this is not possible now. What we are seeing is a gradual increase in prices and nobody really has much say in this. It is useless for the Union to want to set a price if it does not receive energy from Russia. The situation will be difficult, and there will also be a great deal of attrition in companies. Thank God, we at ÉPDUFERR Plc have more than one leg to stand on, not only is ÉPDUKER the main profile of our building materials trade and construction division, we have also started to trade in steel products and manufacture steel products under the name EXIMFERR. 

What is your strategy for dealing with this difficult economic situation? How do you see the future of your company? 
- Despite all this, our company is optimistic! We were listed on the stock exchange in February this year and since then we have been operating as a public limited company. We have recently received the 2021 County Dealer of the Year Award from Masterplast and I can confidently say that we have a good chance of maintaining our leading position in 2022, which we are proud of. We are trying to find new products, new suppliers, to lay the foundations for the future that will keep the company running smoothly. This year, we joined the Lowland Firearms Network, which includes over a hundred dealers, giving us more room to manoeuvre, more manufacturers and suppliers to contact. We now work with around ninety suppliers. We also buy materials directly from abroad. Since this year we have been distributing Kerakoll products, a manufacturer of materials for cladding, insulation and the renovation of monuments. Mapei is a competitor of this company, whose products we also sell. It has a much bigger brand in our country, but we would like to offer our customers an alternative. We launched the products a month and a half ago, and we see that people who know us are coming to us for this material, even from Papa and Gyöngyös. We are working very closely with Masterplast, the largest majority-owned Hungarian building materials manufacturer and distributor in the Central and Eastern European region, and we have joint insulation campaigns on an ongoing basis, for which we also provide a system guarantee. I can tell our existing and prospective customers to feel free to contact us, we can help with everything from the basement to the attic.

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2400 Dunaújváros, Budai Nagy Antal út 1.
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