Manufacturer and wholesale associations warn that demand will likely continue to outstrip supply for products vital to the building engineering sector after a challenging 2021

UK construction manufacturers are facing continued cost pressures as a result of supply challenges and high levels of demand, prominent industry bodies have warned.

A joint statement from the chief executives of the Builders Merchants Federation (BMF) and the Construction Products Association (CPA) said that the overall market at the end of 2021 was no longer experiencing the extremely high levels of demand seen earlier in the year.

However, both organisations remain concerned that this demand would continue to outstrip supply for a range of products, particularly imported goods – even with most UK production at full capacity.

Supply challenges

HVAC specialists and suppliers have warned that the industry had faced a ‘perfect storm’ of supply challenges during 2021 that was driving up prices of goods to unprecedented levels as a result of issues linked to the UK’s Brexit withdrawal and the ongoing pandemic.

The joint statement from BMF chief executive John Newcomb and his CPA counterpart Peter Caplehorn said that uncertainty around vital supplies and the pricing of products was now a broad area of concern for the entire construction sector.    This was expected to impact steel, cement, bricks, blocks, glass and ceramics into 2022.

Shortages were also noted for products with electronic components and goods made of steel. This was impacting cable trays as well as twin and earth cable, according to the joint statement.

It said, “Product pricing continues to be challenge, particularly for medium-sized contractors working on tight fixed price contracts.”

Both the CPA and BMF warned about the additional impacts of ongoing regulation changes resulting from Brexit, as well as the possibility of further spikes in Covid-19 cases.

The statement said, “The impact of full Border controls that come into force at the end of 2021 is a further unknown, as is the implementation of the new UK CA Mark and UK Registration, Evaluation, Authorisation & Restriction of Chemicals (REACH) regulations.

The statement also said that reported concerns over the availability of HGV drivers appeared to have lessened in the build-up to Christmas

It stated, “However, imports, particularly from the Far East, continue to be affected by long lead times, delays at ports and high container costs.”

Earlier this month, Wolseley UK said it had made a significant ‘multi-million-pound investment’ in boilers and parts to help the industry prepare for winter.  The company boasted that it had built up a stock of more than 40,000 boilers and 800,000 spare parts around the country to meet any shortfalls in product demand resulting from global supply challenges.


Source link