Rising global demand for steel has so far added $130,000 to the cost of renovations to Lewiston’s Colisee and $80,000 to the cost of Auburn’s library addition.

Lewiston officials are watching the international steel market to see how it will affect other projects, including a planned $4.5 million Southern Gateway parking garage.

“We haven’t even gone to bid on that yet, so we don’t know what the impact will be,” said Finance Director Richard Metivier. “But there is no question, there will be some.”

The original budget for Colisee renovations – a three-floor glass facade with a third-floor party room, second-floor concessions and first-floor offices – was set at $1.5 million in May.

The cost of steel for pilings to support the facade and for the structure itself was budgeted at $195,000, Metivier said.

But rising steel prices have driven those costs up to about $325,000.

“Those were costs we just didn’t program for when we set the budget in the spring,” Metivier said.

The impact on the Auburn Public Library project has so far included eliminating some of the mill work and some floodlights in the front of the building, said Director Rosemary Waltos.

“We may put off refinishing some of our wood floors,” she said. “And we’d hoped to put a natural-light dormer to let some sunlight into the second floor. We’re not doing that at this point.”

The construction budget is about $5 million, and officials hope to keep it there, Waltos said.

The finishing details, such as the dormer, may be folded back into the project as it moves along.

“We understand that the prices have leveled off, in a sense, so we’re hoping to lock in our steel prices soon,” she said.

Work on the library is scheduled to begin later this summer. The project has not yet gone out to bid.

China boom

According to an international steel consultant group, MEPS International Limited, the cost of carbon steel building products has risen from about $300 per metric ton to about $500 per metric ton, on average.

The cost of scrap metal alone has more than doubled in the past 14 months, according to Bob Roy Jr., president of Lewiston’s Steel Service Center.

Blame a building boom in China, Roy said.

“They’re in the middle of a huge boom, and their demand has been just outrageous,” he said. “They’re buying up all the scrap metal they can get.”

The demand for structural steel has leveled off in the past month, Roy said. But it’s leveled off much, much higher than it was a year ago, he added.

Rising prices are already hurting the industrial sector, with Midwestern automakers the hardest hit. Closer to home, Bath Iron Works officials acknowledged that steel prices were higher but declined to say how the prices were affecting them.

“We are seeing the same upward pressure on prices that everyone else is,” said Jim DeMartini, communications principal. “But how we deal with it is business-sensitive. We’re not anxious to have that show up in a public forum.”

Work goes on

The high price of steel hasn’t stopped many construction projects in Maine so far, but it is causing headaches.

“You cannot get a guaranteed price on steel that’s good for more than a day” said Scott Tompkins, deputy director of the Associated Constructors of Maine, a trade group. “That is wreaking havoc on the bidding process. You used to be able to get a price good for a week or so, but things change so much day to day, it’s not possible.”

John Butts, executive director of the group, said he doesn’t expect the high prices to chase any projects out of Maine

“The problems are uniform, from Maine to California,” Butts said. “If they were going to do a project in Maine, this won’t convince them to go someplace else.”

But it may convince them to look at alternatives.

In Auburn, officials are taking a second look at designs for a Great Falls Plaza parking garage. Work on the $5 million project is set to begin next spring.

“Put it this way: It might make concrete or a concrete-steel hybrid design more competitive,” said Mark Adams, assistant city manager. Concrete garages are usually more expensive to build, but typically last longer and are cheaper to maintain.

“We’d like to have concrete, and if the price of steel makes using more concrete a better deal, that would make our decision much easier,” Adams said.

Lewiston will follow through with the Colisee work, Metivier said.

“We are committed to doing the project, and we are still working to keep the final budget in line,” Metivier said. The city could take a second look at some of the final details, such as furniture, as it nears completion.

“When that happens to the cost of the basic structure, you have to make adjustments,” Metivier said.

Work on the Lewiston Public Library hasn’t been affected by the rising prices because that project began before the climb, Metivier said.

He speculated that prices could change by the fall. “They might decrease, actually, and that would certainly level the playing field,” he said.