Statement from 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
The overall product availability picture has not changed this month. Demand both in the UK and globally continues to dramatically outstrip supply and shows few signs of slowing during the seasonally busy summer months.
In the UK, record sales of building materials coupled with strong pre-orders and full pipelines of work are all putting enormous pressure on the supply chain which, in some sectors, has not fully recovered from the impact of Covid. This suggests the unprecedented challenges around a number of key product areas, particularly imported products and materials, will likely persist into the second half of 2021.
Timber, roof tiles and some steel products continue to be in short supply, as is bagged cement which may have been impacted by some manufacturers undertaking overdue preventative maintenance. Paints, sealants and chemical products, continue to be affected by raw material shortages, with paints additionally affected by a shortage of packaging, particularly metal cans. The situation with insulation boards has also become tighter, with PIR becoming harder to obtain and contractors actively seeking alternatives. Plasterboard has been subject to extended lead times with one major manufacturer indicating their products going on allocation. Some regions are also reporting delayed deliveries of bricks and blocks.
Electrical products have been affected by raw material shortages, particularly steel products and semi-conductors, since Autumn 2020. These issues are now compounded by the shipping backlog in China’s Pearl River Delta, with hundreds of container ships waiting for berths to become available. The Electrical Contractors Association and their Scottish counterpart, SELECT, are warning that the blockage already surpasses that of the Suez Canal earlier this year and is likely to lead to extended delays for electro-technical products.
The availability of hauliers is a particular issue raised within the group over the past months and it is clear that this is now a critical nationwide problem causing delays and impacting project programmes. The UK has lost 15,000 European drivers this year due to Brexit, and 30,000 UK driver tests due to Covid, which has exacerbated the driver shortage. The CLC’s Product Availability Group is supporting the Road Haulage Association in its discussions with the Department for Transport to address the shortage.
Inevitably, all of this is feeding into price inflation, and the expectation is that high demand coupled with tight supply will sustain elevated prices throughout the year.
As we emphasised last month, forward planning and ongoing communication throughout the supply chain is essential to assist with reliable delivery dates and to manage expectations about any shortages or allocations.
Allocation systems should be as transparent as possible, so all customers can be seen to be treated fairly and provided with both the information and the products they require to plan and complete projects in a timely manner.
Builders and contractors should also maintain open communications with their customers regarding lead times, possible product substitutions and early notice of potential price increases.
Manufacturers and trade associations are providing updates on availability in their specific areas, including: