Architects and the wider construction industry have been hit hard by material shortages in 2021.
The supply chain crisis has led to skyrocketing prices and huge delivery times for materials such as timber, wreaking havoc with projects across the country. Government statistics show that material costs increased every month between September 2020 and September 2021.
As 2022 approaches, shortages appear to be easing, but some key products are still in short supply. In an update last week, the Construction Leadership Council (CLC) said it appeared the Omicron Covid variant had inflicted only “limited” disruption, but prices remained a concern, with multiple increases expected.
The architectural profession is still affected by the shortage. RIBA’s latest report on future trends reveals that cost inflation, coupled with shortages of materials and personnel, are causing project delays and making bidding increasingly difficult.
Our explainer provides an update on the latest supply chain information and provides information on materials facing price increases or shortages by 2022.
What causes the continued shortage of materials?
A number of factors. The industry has not recovered from the devastating impact of the first wave of the Covid-19 pandemic. At its peak, material production slowed, but demand increased as owners embarked on improvement projects during the lockdown, further increasing pressure on supply chains.
There is also still a lot of uncertainty around Brexit. New regulations and delayed shipments mean materials from overseas are harder to find. Labor shortages also played a role, such as the lack of truck drivers and the shortage of construction workers.
What materials are involved?
Imported timber was one of the materials hardest hit by the supply crisis but, after record imports, the situation has returned to more normal levels and prices have fallen from last summer’s highs. The Timber Trade Federation (TTF) said last week that “stability” had returned to the market and stocks had been replenished.
“However, the market is still a long way from ‘normal’ as Brexit, HGV driver shortages and Covid-19 disruptions continue to affect supply and demand, as well as labor availability. work,” the TTF said.
The CLC indicates that longer delivery times could return as the volume of demand increases later in the year.
Bricks and blocks
The high level of demand means that a shortfall in domestic brick production will continue through 2022, according to the CLC. That is until three new UK brick factories start production in 2023 and 2024, which together are expected to produce 150 million bricks a year. The Brick Development Association suggests that with demand expected to remain high, delivery times will be an issue for the coming year.
Cement production fell 11.4% in 2021, according to BEIS, and the supply of bagged cement has been tight since late last year. The CLC said that while availability has eased for now, shortages could return.
Last summer British Steel stopped taking orders for structural steel sections due to “extreme demand” and prices soared. However, the situation has now improved. British Constructional Steelwork Association (BCSA) chief executive David Moore said New Civil Engineer“Steel prices are as stable as those of any other construction material and its supply chain is very successful.”
Roofing products are still hard to find. According to a survey by the National Federation of Roofing Contractors (NFRC) and industry tracker Glenigan, 92% reported an increase in prices and 77% of roofing companies reported a deterioration in availability. The CLC reported this week average delays of 24 weeks and reaching 41 weeks for certain profiles. Additionally, clay roof tiles are subject to price increases, due to rising energy costs.
Are the prices still rising?
The situation is still volatile, but the most recent statistics produced by the Department for Business, Energy and Industrial Strategy (BEIS) show that materials prices have stabilized for the first time since September 2020.
The data shows that costs did not rise in November last year and that the prices of steel and wood, two of the materials that saw the biggest increases in 2021, fell. The price of imported sawn or planed timber fell 7.6% (though still 52.4% more expensive than a year ago), while steel prices fell 0.3 % month over month (yet steel remained 66% more expensive than it was in November 2020).
Building materials supplier Jewsons’ January update reveals that manufacturers are continuing to raise prices due to “unprecedented global demand” as well as rising transport costs and operational procedures such as social distancing.
What impact does the shortage of materials have on architects?
The architects were very touched. According to the November RIBA Future Trends Report, scarcity of materials led to onsite delays for 74% of practices, and more than a quarter of reported onsite work was suspended. A quarter now report delays in the design process, up from 18% in June. Building News reported this week that 9 out of 10 major construction projects (over £100million) are currently behind schedule.
Price increases meant it was difficult for architects to budget and a limited product range made sustainable design more difficult, according to RIBA analysis.
We have considered alternative suppliers on projects
Luke Tozer, director of London firm Pitman Tozer, said delays prolong programs and force the firm to reassign staff when projects are slow, although he added that it was “a normal part of running a business “.
He added that there was still strong demand for affordable housing, but some projects had “taken longer to enter contract, required higher value engineering to stay on budget and had been slower to start. on the spot “.
Regarding material exchanges, Tozer said, “We had to review some brick specifications and we considered alternative suppliers on the projects. For an off-site project, the turnaround time for suppliers has recently dropped from four months to 11 months from the time of order, which does little to help deliver the homes people need.
Turning to builders, a recent survey by the Federation of Home Builders found that 78% of home builders said the supply and cost of materials such as bricks, timber and cement posed a huge problem.
When will the shortage of materials end?
Not yet. According to the CLC, pressures on global shipping, including delays and price volatility, are expected to continue through 2022. It added that although issues that previously affected the availability of timber and cement mitigated, they have not been fully resolved, and it will take longer. times may return when demand increases later in the year.
The government has been urged to step in to help the sector find ways around shortages as they arise. Last year the National Builders Federation called on ministers to step in and urge councils to show greater flexibility on material changes, while the Building Back Britain Commission warned in November that targets government housing construction could be threatened.
On construction worker shortages, London Mayor Sadiq Khan last week called on the government to create a temporary visa scheme as job vacancies in the industry hit their highest level in 20 year.
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