Pingdemic intensifying supply chain shortages

Grant Prior 2 years ago
Share

Construction materials leaders are 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.

It’s 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.”

The statement penned by 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.

It said: “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.

“Labour, or rather the lack of it, is a rising concern.  All regions report hauliers/HGV/LGV drivers are in short supply and very difficult to recruit, which is contributing to longer delivery times particularly away from major transport routes and urban areas.  We continue to support the Road Haulage Association in its discussions with the Department of Transport to address the shortage.  We are now receiving reports of other vacancies being hard to fill, from relatively unskilled roles, such as yard operatives, to experienced bricklayers.

“These 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.

“Looking forward, housebuilders are managing current builds to completion but there are indications that smaller, regional developers may be forced to delay starting work on new sites until they have more certainty around product availability and lead times.

“The demand for home improvement and RMI work remains strong but most work in this area is covered by JCT contracts which have no facility for any flexibility on material costs, leading to fears that we will see business failures arising from unsustainable contracts.  This is now being investigated and may require a change in contractual positions.

“Alongside pricing, stability and accuracy of supply remains the overarching concern and regular, accurate and transparent communication throughout the supply chain to the end client is deemed vital by all.  It is important that all parties recognise the extent of the extraordinary challenges we are currently experiencing and adopt a flexible and collaborative approach to finding solutions.”

Latest news

Gove issues six weeks ultimatum to sign building safety contract

Developers told to sign Government contract issued today or be banned from building homes
3 hours ago

Firm fined £120,000 for lifting two builders in a telehandler bucket

Rochdale builder Hoyle Developments fined after repeated safety breaches
3 days ago

Hunt quashes reports HS2 will stop at Old Oak Common

Chancellor says no "conceivable circumstance" where HS2 would not terminate in Central London
2 days ago

London Chiswick roundabout 24-storey tower approved

Plan for 255 flats and offices finally passed after four previous schemes failed to proceed
3 hours ago

Construction forecast to fall by nearly 5% this year

Private new build housing and RM&I to drive fall but infrastructure growth will also slow
2 hours ago

Mace wins green office block at famous Fleet Street pub site

Contractor to build new 12-storey block pioneering latest sustainable construction methods
3 hours ago

Firms readied for raft of net zero and building safety frameworks

Procurement specialist LHC to tender five mission zero retrofit and building compliance deals
3 days ago

Plans in for two Derby city centre schemes of 1300 homes

Eagle Quarter and Bradshaw Way schemes to breathe life into Derbion centre area
3 days ago

United Living names new infrastructure services MD

Former SSE Contracting operations director John Farrell joins multi-service contractor
3 days ago

Sunak promises Bill to build £100m Holocaust Memorial

Holocaust Memorial Bill will update historic legislation allow the building of a new memorial in London
3 days ago

Mace Interiors to transform Hanover Square office block

Refurbishment work to start this year on major revamp of Mayfair building
4 days ago

Garden village in Darlington gets £43m infrastructure cash

Transport and highways work will pave way for 2,000 new homes
4 days ago

Plans in for Lendlease £1.9bn Birmingham Smithfield scheme

Ambitious plans for City's old market area advance with enabling works hoped to start this year
5 days ago

TClarke on track for £500m turnover this year

Building services specialist sees 2022 revenue and profit up by around a third
4 days ago

McAlpine tenders M&E work at £340m Museum of London job

Demolition and first MEPH work packages come out to bid
4 days ago

BAM signs off on £65m Manchester First Street office job

Briggs & Forrester lined up for MEP package
4 days ago

Eurocell gets £1m insurance payout after cyber attack

UPVC giant details cost-cutting round as market weakens
4 days ago

Mace on board for £440m Manchester Airport upgrade

Green light for second phase of airport transformation programme
5 days ago

Inland Homes losses now set to hit £91m

House builder sells land as construction problems and slower sales wreck balance sheet
5 days ago

Plans in for Stoke on Trent city centre mixed-use scheme

Etruscan Square scheme consists of an arena, 300 homes, hotel and multi-storey car park
5 days ago

Landsec unveils latest £850m Buchanan Galleries plan

Subject to planning, earliest date for first construction would be summer 2024
6 days ago

Van Elle soars to record revenue in first six months

Revenue up a third to £80m at piling specialist with improved order levels ahead
5 days ago

Work starts on BSI Kitemark for MMC homes

Government backs new British Standard to lift barrier to modern methods of construction
5 days ago

Watchdog blasts “rushed” UK Infrastructure Bank

Funding deals only seen so far on broadband and solar farms projects
5 days ago

60,000 Grandfather Rights skills cards soon to be invalid

New guidance issued for how experienced workers can get new CSCS cards before end of 2024
6 days ago

Worker dies after cardiac arrest in HS2 site office

Colleagues and emergency services tried to save man after he collapsed in tunnelling office
6 days ago

Mace wins £150m life sciences centre

Construction to start in April creating 1,000 jobs on London's Euston Road
7 days ago

Redrow switches to heat pumps as standard in all new homes

House builder commits all new detached homes from this month to have heat pumps and underfloor heating
6 days ago

Gilbert Ash set for Barnfield College next phase

Contractor understood to have won latest £26m deal at Luton site
6 days ago

Willmott Dixon wins £48m zero-carbon West Sussex school

Work to start in April on Passivhaus-designed Bedelands Academy secondary school project
6 days ago

Contractor services