Case Study: Houston Highway Interchange Project Delayed by Steel Reinforcement Bar (Rebar) Shortage (2022)
Project Overview
• Name: Houston I-610 Interchange Improvement
• Location: Houston, Texas
• Year: 2022
• Project Size: $620 million
• Scope: Reconstruction and expansion of highway interchange including extensive concrete and bridge works
• Lead Agencies/Contractors: TxDOT /
Category of the Issue, Problem, or Challenge
• Supply Chain Disruption
• Reinforcing Steel (Rebar)
Summary of the Issue, Problem, or Challenge
The project experienced significant delays and increased costs due to shortages and delivery delays of steel reinforcement bars caused by supply chain disruptions linked to tariffs and production bottlenecks.
Root Cause Analysis
- Tariffs on imported steel increased costs and disrupted supply chains.
- Domestic steel mills faced capacity constraints and production slowdowns.
- Over-reliance on a small group of rebar suppliers.
- Lack of early procurement planning and inventory buffers.
Impacts Due to the Issue, Problem, or Challenge
• 3-month delay in concrete pours for foundations and bridge decks.
• Cost overruns from rush orders and alternative sourcing (~$5.1 million).
• Rescheduling of subsequent construction activities causing cascading delays.
Corrective Actions Taken
- Diversified supplier base to include more domestic and regional producers.
- Implemented advance procurement and stockpiling strategies.
- Engaged in proactive contract negotiations to stabilize pricing and delivery schedules.
Lessons Learned
- Critical construction materials like rebar are vulnerable to trade policies and market fluctuations.
- Early supplier diversification and procurement are essential to mitigate supply risks.
- Communication and contract flexibility help manage unforeseen supply issues.
Audit & Prevention: Project Control Questions to Ask on Future Projects to Help Control the Situation
- Are rebar supplies secured from multiple qualified suppliers?
- Is procurement timing sufficient to accommodate market fluctuations?
- Are contracts flexible enough to adjust for price and delivery changes?