Ireland’s manufacturing sector has been badly hit by inflation, with the wholesale price of electricity rising by 260% over the past year, while significant increases have also been recorded for a range of materials, especially steel and wood.
Just days after the Central Statistics Office (CSO) released figures showing Irish consumers were hit by a 5.5% price rise last year, new figures show a similar impact for manufacturers Irish with an increase in the cost of materials of 8.6% and a rise in petrol prices of 13.9%. %.
According to the CSO, the cost of wholesale electricity has increased by 260.4% compared to the 2020 average. The prices of other wholesale energy fuels have also increased, and the index for all energy products has increased by 160.6% compared to 2020 and the price of petroleum fuels increased by 14.2%.
Prices for some building materials recorded strong increases in 2021. The average price of raw wood rose 43.1%, while other types of wood were up 20% from 2020 levels. steel product prices rose by 17%, cement prices by nearly 5%, insulation by 5.6% and plaster by 13.9%.
Cairn Homes, one of the nation’s biggest builders, said this month that inflation in building materials was adding €15,000 to the cost of an average home, adding new headaches to a struggling sector to meet housing demand.
In its outlook for 2022, the Society of Chartered Surveyors Ireland (SCSI) said residential property prices are expected to rise by 5% this year. With material costs soaring, they called for the removal of planning delays and addressing supply and infrastructure issues to help reduce the cost of building new homes.
Overall, the CSO figures show that the price of goods leaving factories in Ireland rose by 4.5%, according to the wholesale price index. Prices received by Irish growers last year fell 5.3% after a steeper fall of 8.7% in 2020.
The overall index for the food, drink and tobacco sector increased by 0.2% in 2021, compared to a decline of 1.5% in 2020. The index for food products increased by 0.2% in 2021, while that of beverages increased by 0.4%.
Within the food sector, prices rose slightly last year, up 0.4% with strong increases in prices for meat and meat products, up 11.2% and dairy products which increased by 9%.