The statement was released by Builders Merchants Federation CEO John Newcomb and
Peter Caplehorn, CEO of the Construction Products Association, both co-chairs of the working group.
“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 (RMI) over the Christmas period,” they said.
“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.
“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.”
They said the impact of the Omicron variant of Covid-19 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.
The statement also warns a shortfall in the domestic production of bricks, which is already at full capacity, will continue throughout 2022 until three new UK brickmaking plants come on stream in 2023 and 2024, boosting UK annual capacity by about 150m bricks per year. Imports largely from the EU and potentially beyond will be required to meet current demand.
Demand for roof tiles remains high with lead times averaging 24 weeks and rising to 41 weeks for some profiles. Additionally, clay tiles are subject to price increases due to rising energy costs.
Raw material supply for plastic products has stabilised over the last quarter, leading to improvement in product supply.
“Delays and volatile prices for global shipping look set to continue at least until Q3 2022. China is home to seven of the top 10 container ports, which have a sustained ‘zero’ policy with regard to Covid outbreaks, leading to shutdowns and delays that have worsened global bottlenecks.
“Furthermore, with the Beijing Winter Olympics taking place in February, factories will be closed in 64 northern Chinese cities to improve air quality. This will almost certainly affect some construction products, which will have a knock-on effect of levels of inventory later in 2022.
“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.”
