Construction Products Association: Rising Input Costs Set to Hit Construction in 2011
The costs of energy, fuel and materials have risen significantly over the last twelve months and are expected to continue to rise in the next 12 months according to a survey by the Construction Products Association. Product manufacturers reported that in addition to eroding margins, these increases will also raise construction costs despite the challenging economic environment.
Noble Francis, Economics Director at the Construction Products Association said:
‘More than three quarters of manufacturers reported that costs rose significantly over the last 12 months, with the last three months seeing a particularly sharp increase. Cost rises were mainly due to fuel, but increases in the prices of copper, steel and plastics also contributed to the rise. Looking ahead, the vast majority of manufacturers also anticipate that costs will continue to rise significantly over the next year, which will reduce margins further and push up costs of construction. The Association is forecasting that output will fall by 2% during 2011 due to the impact of the public sector spending cuts, so this will exacerbate problems for the industry.’
Key points from the survey include:
77% of manufacturers reported that input costs rose significantly during the last 12 months
59% of manufacturers stated that input costs rose significantly during the last three months
97% of manufacturers reported that fuel costs rose significantly over the last 12 months
65% of manufacturers anticipate further significant rises in the price of fuel during the next
12 months
75% of manufacturers stated that gas prices had risen significantly during the last 12 months
43% of manufacturers anticipate that gas prices would increase significantly during the next 12 months
Kind regards,
Avani Raval
External Affairs Executive
Construction Products Association
26 Store Street
London WC1E 7BT
Tel: 020 7323 3770
Fax: 020 7323 0307
avani.raval@constructionproducts.org.uk
www.constructionproducts.org.uk
Registered Office as above
Company Number: 386 1752
Registered in England
-01.png){kind=spacer}