Material Shortage

8 in 10 Builders are Being Forced to Delay Projects Due to Material Shortages

Over the last 12 months, the construction industry has had to battle a lot of challenges due to the pandemic and Brexit, but one challenge is set to continue. Since the first lockdown, companies have noticed a real struggle to get certain materials, leading to an increase in prices and increased lead time for deliveries.

The Cause

The main causes of the material shortage are higher consumer demand for materials, lack of HGV drivers, and delay in manufacturing material, all issues caused by Coronavirus and Brexit.

The Road Haulage Association estimates there is a shortage of around 100,000 drivers. A lot of the haulage drivers in the UK came from Europe and due to Brexit, they cannot come over, this meant we lost 15,000 haulage drivers. As well as lack of European drivers, UK residents could not complete the relevant test with over 30,000 tests cancelled due to the pandemic and even months after the country reopening there is a 17-week wait to take the practical test. The government has announced this week (5^th September 2021) they will be looking to combine the Class C and Class E test, this will shorten the time it takes to complete a full licence by around 2-3 weeks. This new regime could mean around 3,000 new HGV drivers will pass per week.

Lead time for materials has increased due to not being able to get materials into the UK or not having the drivers to haul them to sites across the UK.

With more people working from home and needing to add office space and people finally completing those pesty DIY jobs they kept putting off, increased the demand for materials. The cost to complete these simple repair/maintenance jobs rose by 23%in the last year according to BEIS report completed in July.

Rising Prices and When Will this Stop?

With materials dwindling prices have begun to rise by an average of 20%. The information in the table below comes from an article written by Home Building (see link below)

Materials Price Tracker
	Material	Information
	Timber	According to the Timber Trade Federation timber prices are at their highest level for 13 years,
	Steel	Fabricated structural steel prices jumped 53.3% in June 2021, according to BEIS. (Department of Business Energy and Industrial Strategy)
	Cement	Cement prices have risen as much as 30%, as reported by The Telegraph. In June, Travis Perkins raised prices by 15% and prices will continue to rise
	Paint	According to the Construction Products Association, the costs of paints and varnishes are up by nearly a third.
	Chipboard	Chipboard costs went up by 10% in May and continue to rise

Prices are set to remain high for the foreseeable with increases still expected to happen until 2022 when hopefully the markets will stabilise.

Material Shortage and When Will it End?

Material shortages are at their worst in over a decade, and like price, increases are expected to continue.

• Timber; There has been a nationwide timber shortage since the first lockdown in March 2020 and imports remain an issue.
• Steel; Steel is in high demand globally, and shortages are set to continue. British Steel recently stopped taking orders on structural steel sections due to “extreme demand”.
• Roof tiles; Roughly half of National Federation of Roofing Contractors members reported a shortage of concrete roof tiles earlier this year. Lead times for concrete tiles are between 20-36 weeks, on average, while lead times for clay tiles are between 4-8 weeks.
• Cement; Supplies of bagged cement have been strained since late last year, and Pal Chana, executive director of the Mineral Products Association, warned in July that supplies will not return to normal until at least the end of the year.
• Electrical components; Certain electronic components, caused by a shortage of raw materials, could extend into next year
• Paints and sealants; Supplies to the UK are restricted due to a global shortage and cost of shipping containers, which are adding to the cost of materials.
• Plaster and plasterboard; There was a severe plaster shortage earlier this year, and while supplies improved slightly, plasterboard has been subject to extended lead times, and had a massive price hike  
• Glass; Since earlier this year there has been a huge shortage of glass, this is mainly down to the two largest float lines being down for scheduled maintenance. This paired with the lack of access to European lines due to transport issues and not having an option to order from further afield has had a huge impact on the industry. There is a glimmer of hope with a new furnace being built in the UK expecting to open in September and the others reopening by the end of the year.

How Urban are Overcoming these Issues  

• Collect materials from the merchants in order to not experience delivery delays
• Plan for materials as far in advance as possible and warn clients about possible delivery delays due to shortage
• Be upfront about the possible increase in cost of certain materials during the project and advise clients to allow for contingency costs to help cover the prices increase post quotation

Further information

1. https://www.homebuilding.co.uk/news/construction-materials-shortage
2. https://www.theguardian.com/business/2021/sep/06/uk-building-firms-materials-staff-construction-industry
3. https://www.theguardian.com/business/2021/sep/06/uk-building-firms-materials-staff-construction-industry
4. https://www.constructionnews.co.uk/supply-chain/smes-finding-ways-round-material-shortages-17-08-2021/?utm_source=Bibblio&utm_medium=Recommendation&utm_campaign=Recommended_Articles
5. https://www.doubleglazingblogger.com/2021/07/when-will-the-glass-shortage-end/