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Supplies affected by Pingdemic isolation calls

Builders merchants trade association the Builders Merchants Federtion is among the consruction indusry groups warning that supply chain shortages are being exacerbated by the NHS Covid app ‘pingdemic’.

The latest problems were highlighted in a statement from the  Construction Leadership Council’s Product Availability working group.

Its update warned that “labour shortages are being exacerbated by the growing number of non-symptomatic drivers, tradespeople, merchant and manufacturing staff required to self-isolate after coming into contact with someone who tested positive for Covid-19. This will further stretch the supply chain.

John Newcomb, CEO of the Builders Merchants Federation and Peter Caplehorn, CEO of the Construction Products Association gave a thorough run down of current problems and pinch points in the supply chain.

The basic trends of the last six months remain, with global demand far in excess of supply leading to product shortages, rapid and sustained price inflation, long lead times and uncertainty regarding deliveries.

It is also clear that the global shipping industry is far from recovered from the disruption caused by the coronavirus pandemic, with congested shipping routes, container cancellations and higher costs still evident.

The products most affected are those used in housebuilding and domestic repair maintenance and improvement (RMI), including roofing products, timber, insulation, landscaping products, blocks, sealants/PVA, PIR Insulation, kitchen carcassing and products that use plastic, e.g. drainage, some windows and bagged cement.

Bagged cement is particularly hard hit due to ongoing unprecedented demand but both bagged and bulk cement are on allocation; there are regional variations to this with some areas affected more than others. All UK kilns are operating but it may be a while before stocks return to normal. With high demand continuing, extended delivery times are expected to remain until the end of the year.

The high level of housing starts has caused a bow wave of demand for plastic pipes for groundworks and drainage. Some manufacturers are currently on allocation, but the expectation is that supply issues will be resolved by the end of Q3.

Demand for wood and wood products remains very strong and timber supply will continue to tighten into Q3, following the Scandinavian holiday and maintenance season in July, continuing the upward pressure on prices.  There are some indications that the situation may start to improve after this as global demand is beginning to ease.

Within infrastructure and commercial construction, steel and aluminium are both experiencing significant supply disruption and price inflation.

There is also concern around the availability of steel cabling management systems which could continue into early 2022 and engineering services business are advised to plan ahead.

Overall, prices for products and materials have increased by a reported 10-15%, consistent with the Office of National Statistics figure for May of 10.2% overall with 12.8% for those most commonly used in RMI.  Specific products, especially timber, has seen increases of 20-50% for most products and over 100% for OSB and other sheet materials. For the first time we have had reports that some merchants are destocking certain products that are no longer economic.

 

About Fiona Russell-Horne

Fiona Russell-Horne
Group Managing Editor across the BMJ portfolio.

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