INCC monitors the monthly evolution of the prices of materials, equipment, services and labor in the sector; the change goes into effect from July
RIO – The Brazilian Institute of Economics Getulio Vargas Foundation (Ibre/FGV) announced a methodological review of the National Cost of Construction (INCC) from July 2023. The new structure will change the basket and the weight of the registered items.
The geographical scope remains the same, but the weights of the regions in the calculation of the index will also change: cities in southeast they gain prominence, while others lose participation. The changes aim to update the calculation of the indicator, in order to express the cost structure of companies in the construction sector in a more realistic way after the cyclical and structural changes that have occurred in the Brazilian economy and in the sector itself in recent years.
“The only difference between them is the collection period, which always takes place over 30 days, but with 10-day intervals between them,” recalled the FGV. “The weights that will be effective from July 2023 will be updated separately for the INCC versions 10, M and DI, after being updated by the respective rates of change of prices and after the publication of the results of these indices for June 2023”.
The current INCC basket consists of 52 sub-entries, with 11 sub-entries detailing the work. In the new sample, the researchers conducted a purification of the basic inputs, eliminating or grouping items of low representation in the total cost of the works. Even so, the new basket includes 79 types of materials, equipment and services, including 19 relevant job categories.
The costs of materials and equipment represent 54.78% of the new INCC; services, by 5.80%; and work, by 39.42%.
Among the items that have lost weight in the calculation of the INCC there are janitors (from 9.73% of the current basket to 2.00% after the methodological revision), formwork carpenter, fixtures and roofs (from 5.68% to 2 .98%), engineer (4.15% to 3.06%), iron and steel pipes and fittings (1.63% to 0.20%) and mortars (1.93% at 0.84%).
In the opposite direction, some items that gained importance in the cost basket were carbon steel bars and wires (from 3.02% to 6.50%), electrical materials (from 0.92% to 2.07%) , aluminum joinery (1.85% to 2.78% ), cement grout (2.27% to 4.45%), mason (6.07% to 7.90%) and builder naval or blacksmith (1.65% to 3.04%).
Prices will continue to be collected in seven cities: São Paulo (moving from 43.29% share in the current INCC to 44.51% share with the new weighting), Rio de Janeiro (from 9.49% to 14.27%), Belo Horizonte (11.13% to 16.16%), Recife (5.24% to 3.81%), Salvador (9.31% to 7.84%) , Porto Alegre (from 11.04% to 10.54%) and Brasilia (from 10.5% to 2.87%).
“The new weights have been extracted from the Regional Accounts of the IBGE (Brazilian Institute of Geography and Statistics) and reflect, on the basis of GDP (Gross Domestic Product), the weight of civil construction in the States where the Municipalities of these city ”, justified the FGV, in a technical note.
In the new INCC, the economic construction standard had a weight of 33% in the calculation of the index; the average standard, 41%; and the top, 26%.
“The revision of the INCC weighting structure has increased the number of sub-items that make up the indicator, making it more in line with the modernization of residential building construction processes. weights between constructions of different standards and technologies, revealing which elements influence constructions targeting different audiences,” the paper added.
Ibre/FGV will publish on its website the table of correspondence between the old structure and the new one to guide the users of the indicator.
Source: Terra
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