{"id":473956,"date":"2023-02-10T11:45:43","date_gmt":"2023-02-10T11:45:43","guid":{"rendered":"https:\/\/www.constructionnews.co.uk\/?p=473956"},"modified":"2023-02-10T11:45:43","modified_gmt":"2023-02-10T11:45:43","slug":"challenging-times-far-from-over-as-commodity-prices-to-stay-high","status":"publish","type":"post","link":"https:\/\/www.constructionnews.co.uk\/supply-chain\/challenging-times-far-from-over-as-commodity-prices-to-stay-high-10-02-2023\/","title":{"rendered":"Challenging times ‘far from over’ as commodity prices to stay high"},"content":{"rendered":"

Rampant construction commodity prices show little sign of easing, according to a new analysis.<\/span><\/p>\n

Construction consultancy Linesight says in a new report that although the across-the-board hyperinflation experienced last year is now over, prices are set to remain high, driven by the cost of energy and a lack of required skills in the worldwide supply chain.<\/span><\/p>\n

The UK-focused analysis highlights the cost of bricks and plasterboard, which are predicted to increase by 11.5 per cent and 10 per cent respectively this quarter as a result of high production costs.<\/span><\/p>\n

Strong demand for concrete and cement combined with high energy costs will keep prices elevated, it said, with a 1 per cent increase this quarter forecast for both materials, although a decline in construction activity is predicted to bring down costs in the following quarters.<\/span><\/p>\n

Despite a downward trend for steel at the end of 2022, the price of key raw materials combined with energy costs and their impact on production are set to keep prices high.<\/span><\/p>\n

The outlook for copper prices is mixed as, despite increases in the fourth quarter of last year, concerns over global recession persist.<\/span><\/p>\n

However, the report notes that lumber prices are continuing to fall, with a 1 per cent reduction expected for this quarter due to healthy stock levels and an anticipated drop in construction work.<\/span><\/p>\n

Although supply chain infrastructure is now stabilising \u2013 partly thanks to China\u2019s relaxation of its zero-COVID policy \u2013 shortages of specialist skills within the construction sector are causing ongoing disruption, it adds.<\/span><\/p>\n

Michael Riordan, managing director of Linesight UK, said that with a 1.9 per cent contraction predicted for the UK construction industry this year, the challenging times are \u201cfar from over\u201d.<\/span><\/p>\n

\u201cAlthough supply chains may be up and running at pre-pandemic levels, over the coming year, the construction sector will still be faced with rising interest rates, high energy prices, a scarcity of skilled labour and unreliable global conditions,\u201d he said.<\/span><\/p>\n

A key strategy for minimising risk would be relationship-based supply chain management, Riordan added.<\/span><\/p>\n

Earlier this week, an<\/span> analysis from the Construction Products Association<\/span><\/a> found that demand for heavy materials such as steel, bricks and timber had continued to fall in response to a slowdown in the new-build sector.<\/span><\/p>\n

In contrast, light-side manufacturers recorded a 10th straight quarter of rising product sales.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Rampant construction commodity prices show little sign of easing, according to a new analysis. Construction consultancy Linesight says in a new report that although the across-the-board hyperinflation experienced last year is now over, prices are set to remain high, driven by the cost of energy and a lack of required skills in the worldwide supply …<\/p>\n","protected":false},"author":130832,"featured_media":471093,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ep_exclude_from_search":false},"categories":[57172,57171],"tags":[],"yoast_head":"\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\t\n\t\n\t\n