Construction products shortage ‘likely to worsen before improving’

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As demand for construction products remains high, the Builders Merchants Federation and Construction Products Association have warned that availability issues are likely to worsen before they improve

Construction products in short supply include timber, steel, roof tiles, bricks, screws and fixings, tools, plumbing items and sanitaryware.

“Builders and builders’ merchants alike are being adversely affected by limited availability in a number of important product groups.

“The continuing impact of Covid is one of several factors behind the shortages and price increases but the overall picture is more complex,” says the BMF and CPA in a joint statement.

Materials in short supply

Both trade bodies said the imbalance between global demand and supply for timber means supply ‘is not likely to be resolved in the near future’ and the ‘UK must be prepared for higher prices to continue’.

European production of timber was far lower in 2020 compared to 2019. UK imports of softwood during the first nine months of 2020 were also down, by 20% in volume.

Strong global demand for steel is also resulting in shortages, order backlogs and increased prices for most steel products including coiled, sheet, stainless steel and reinforced bar.

Supply and demand for steel is likely to rebalance within the next few months, however global dynamics may continue to drive prices up.

Reduced production stemming from the impact of Covid coupled with high domestic demand has led to extended lead times on most concrete tiles – averaging 19-20 weeks, with 36 weeks as a worst-case scenario.

Some customers have switched to clay tiles, giving rise to lead times of 4-8 weeks on certain clay products. The situation is likely to improve in Q2 if current production levels are maintained as supply tends to outstrip demand between December and March and stocks can be built up.

The Covid crisis put immense pressure on the entire global logistics industry, impacting the movement of freight and leading to a surge in costs of building products shipped in containers especially from the Far East, including screws and fixings, tools, plumbing items and sanitaryware.

With the continued bottlenecks of container equipment between the UK, the EU and Asia, carriers have reduced routes into the UK by up to 30%, and have increased freight rates massively, with prices per container rising by more than 650%, without space guarantee. While importers are looking at alternative supply chain planning, industry analysts expect pressures to continue into 2021.

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