The ongoing construction materials shortage sees no sign of easing up, and the price of key building materials continues to rise.
The cost of materials rose 8.4% for all construction work in April compared to one year prior, according to the Department for Business, Energy and Industrial Strategy (BEIS). This was a monthly increase of 2.6%.
There were record surges in the price of timber, bricks and steel in May, according to IHS Markit, which reported British construction activity surged in May at the fastest rate in nearly seven years. Remarkably, total new orders for building materials increased at the strongest rate since the IHS Markit Construction Purchasing Managers’ Index began, 24 years ago.
Amid the ongoing shortages of key building materials, suppliers’ delivery times have increased sharply as supply chains once again struggled to keep pace with the demand. And Travis Perkins recently warned of considerable price increases affecting several key materials, including cement and paint.
If you're in the midst of a self build, renovating a house, or undertaking a home improvement project, read on to help plan ahead for your project, and learn which materials are facing price rises or shortages this summer.
How the Construction Materials Shortage Could Affect You
The ongoing materials shortage is liable to impact self builders, renovators and home improvers. Prices are increasing due to lengthening lead times and increasing demand is making it difficult for manufacturers and suppliers to build up stock levels.
Mike Fairman, CEO of Checkatrade, said this week: “The current global raw materials shortage is set to have a big impact on the UK trade and construction industry over the coming months. Soaring demand, the impact of Brexit and the continued pandemic recovery are all having a significant knock-on effect on building and construction timelines, which will in turn affect consumers."
The ongoing shortages will be a particular blow to those working on self build projects who are building with steel or timber frame - materials which are both short in supply - and could potentially face surging build costs.
Renovators could be also be affected by price increases. The cost of materials for repair and maintenance work rose 2% between March and April, and increased by 11.2% between April 2020 and April 2021, according to the BEIS Monthly Statistics of Building Materials and Components report for May.
Building merchants are under increasing pressure, leaving DIY projects in doubt. The Construction Leadership Council (CLC) warned in May that cement, some electrical components and paints are all in short supply.
Which Materials are Short in Supply?
There has been a nationwide shortage of timber since the first lockdown in March 2020, and imports will be an issue for the foreseeable future, with MDF, veneers and solid wood reported by roofers and cladding contractors to be particularly affected.
“There is unlikely to be any improvement in timber supplies this year with little or no timber currently coming into the UK that is not already pre-sold and global demand outstripping supply,” the CLC said in April.
Steel is in high demand globally, and shortages could persist until the end of the year. The British Electrotechnical and Allied Manufacturers Association said in May that a dramatic reduction in steel production in early 2020 had caused a worldwide shortage, while British Steel recently stopped taking orders on structural steel sections due to “extreme demand”.
Supplies of bagged cement have been strained since late last year, but the Mineral Products Association expects shortages to be resolved in a few months.
The CLC said in May that shortages of certain electronic components are becoming a "growing area of concern".
Due to short supply, lead times for concrete tiles have tripled to three months, according to the National Federation of Roofing Contractors.
Supplies to the UK are restricted due to a global shortage and cost of shipping containers.
Plaster and plasterboard
There was a severe plaster shortage earlier this year, but supplies are much improved.
There are also reportedly shortages of:
- PE and PP plastics
- Plumbing items
- Shower enclosures
- PIR insulation and wool fibre insulation
Price Rises are Expected
Overall, the price of building materials increased by 8.4% in April, compared to one year prior, according to BEIS.
And the Federation of Master Builders' (FMB) latest State of Trade Survey revealed that 93% of its members have reported material price increases in the first quarter of 2021. This is expected to continue into the summer.
These are some of the materials which have been affected by price rises:
|Timber||The cost of timber has gone up by more than 80% in the past six months, according to the Construction Products Association.|
|Steel||The price of fabricated structural steel was 17.6% higher in March compared with one year prior, according to BEIS.|
|Cement||Cement prices have risen as much as 30% higher, as reported by The Telegraph. In June, Travis Perkins said the price of bagged cement will rise by 15%|
|Paint||The costs of paints and varnishes are up by nearly a third, according to the Construction Products Association.|
|Chipboard||Chipboard costs are up by 10%, say Travis Perkins|
Why are Materials Short in Supply?
The construction materials shortage can in part be traced back to increased building and home improvement activity in 2020, particularly during the first lockdown. This led to a slowdown in the production of materials from some factories in the EU, and supply chains have remained stretched ever since.
There is currently a global shortage of raw material shortages, stemming from global demand and other external factors (including the slowdown and in some instances, factory closures, outside the UK), which continues to constrain production of certain products, such as insulation, paints and adhesives, as well as packaging for products.
Labour rates + unemployment
Labour rates have skyrocketed in some areas in recent months, due to a combination of demand outstripping labour supply, and some trades putting up their rates due to being overwhelmed with work.
Builder Andy Stevens from Eclipse Property Consultants says: "Labour rates have gone through the roof in some areas, all driven by market factors. Firstly, a number of Eastern European workers went back to their respective countries as a result of Brexit; this has hit the south east in particular."
Employment in the construction sector fell from 2.3m in 2017 to 2.1m at the end of 2020. This represents a 4% fall in UK-born workers and a 42% fall in EU workers, according to the ONS.
The number of UK construction vacancies has now risen to 35,000, which is the highest figure since records began 20 years ago.
Roughly 60% of imported materials used in UK construction projects comes from the EU, according to the CLC, and increased congestion has been reported at UK ports since the turn of the year, leading to delays.
The UK-EU trade deal eased Brexit construction fears once it was confirmed that no additional tariffs on imports or quotas would be added, but the impact of Brexit has already led to disruption, lengthening supply lines for a number of core supplies from Europe.
The Timber Trade Federation (TTF) said in May that Brexit-related complications have squeezed UK timber stocks, as 80% of the softwood used in building comes from Europe, and 90% of the softwood used for new build homes comes from the continent.
How to Navigate Shortages This Spring/Summer
If you’re planning or in the middle of building work this spring and summer, then planning as far as you can in advance is pivotal to ensure you aren’t caught out by shortages or price rises.
This is particularly important as more of us purchase DIY and landscaping products over the spring and summer, which may place an additional burden on supplies.
The CLC advises self builders to work closely with their supply chain and communicate your requirements early with suppliers, distributors and builders merchants.
And Brian Berry says: “Product availability is proving to be a significant and prolonged issue for Britain’s builders, and consumers need to be aware that the cost of their building projects may change in the months ahead because of this pressure.
“However, I would caution against homeowners compromising quality and customer service, and defaulting to hire the builder with the cheapest quote.”
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