16% of Moroccan Construction Firms Face Supply Chain Challenges in 2024

Friday 06 December 2024 - 10:30

By: Dakir Madiha

16% of Moroccan Construction Firms Face Supply Chain Challenges in 2024

Supply chain pressures risk stalling growth in a recovering industry

Morocco's construction sector is grappling with persistent supply chain disruptions, with 16% of firms reporting significant challenges in sourcing raw materials during the third quarter of 2024. This is according to recent data from Morocco’s statistics office (Haut Commissariat au Plan, HCP).

These disruptions come at a time when the industry is gaining momentum, bolstered by growth in housing construction, civil engineering projects, and specialized construction activities. However, the strain on material availability threatens to undermine this progress, especially as global supply chains remain fragile due to geopolitical tensions and volatile commodity prices.

Adding to the sector's woes, 35% of Moroccan construction firms described their financial situation during the same period as "difficult." Rising costs for materials, coupled with delayed deliveries, are creating cash flow pressures that could hinder the sector's ability to meet growing demand and sustain recent employment gains.

Despite these challenges, the sector’s capacity utilization rate (TUC)—a measure of how much of a company’s production capacity is in use—reached 66%, indicating a moderate recovery in production levels. However, sustaining this momentum will require swift measures to address supply chain inefficiencies and enhance access to raw materials in the coming months.

As the year draws to a close, the construction industry faces critical hurdles in stabilizing its operations and ensuring long-term growth. Addressing both supply chain bottlenecks and financial constraints will be key to safeguarding the sector's recovery and meeting the demands of Morocco’s expanding infrastructure landscape.