John Newcomb, CEO of the Builders Merchants Federation and Peter Caplehorn, CEO of the Construction Products Association, Co-Chairs of the Construction Leadership Council’s Product Availability working group issue a joint statement on construction product availability.
While sales remain strong, a gradual improvement in supply has been helped by the seasonal reduction in demand particularly in domestic repair, maintenance and improvement over the Christmas period.
Going into the new year there are relatively good stocks and availability of most products, including timber where prices have also fallen from their peak.
However, as reported in previous statements supply challenges continue to affect bricks and aircrete blocks, roof tiles, steel lintels, manhole covers, plastic drainage products and certain sealants, coatings and paints.
In addition, a shortage of semi-conductors is constraining the availability of boilers at a time when demand is exceptionally high. Semi-conductors are important components for many advanced construction products including lighting and fire protection systems, kitchen white goods and air source heat pumps.
Athough PAG has not seen direct evidence that a shortage of chips is affecting production, we will be increasing market surveillance to spot any early signs of market disruption.
Rising energy costs and price inflation continue to cause concern, with the latest forecasts anticipating 2022 price inflation from 7-10+%, with multiple increases expected for some products.
The impact of Omicron has been limited, with an overall level of absence across UK industry at 5% or less during the past month, though some sectors, such as haulage, have been hit harder than others. Absence due to Covid remains a risk over the winter period but appears unlikely to cause major disruption at current levels.
Looking more closely at current and future challenges:
While the issues previously affecting timber and cement availability have eased, they have not been fully resolved, and longer lead times may return as the volume of demand increases later in the year.
We continue to stress the importance of maintaining open lines of communication throughout the supply chain and encourage all sectors to continue to work closely and collaboratively to manage challenges and plan future work.