Aluminium Fenestration News

CAN PRICES RISE FURTHER? – BY PHIL SLINGER – CAB CHIEF EXECUTIVE

Against the backdrop of increased prices for both aluminium and PVC Fenestration materials, CAB members remain optimistic despite continued hardship for the wider construction industry. To add to these woes, float glass is now playing its part as UK facilities are trying to support Europe’s shortfall in supply, in turn this is pushing UK availability and inevitable price increases.

In this report CAB members feedback is placed alongside the wider construction products reports by the CPA.

‘Quarterly Historic Sales Volumes’ have held up with 48% of members on net balance saying that sales volumes have increased, this shows an increase over Q1 where members reported a 38% increase on net balance. Q2 saw ‘Members Historic Sales Volumes’ return to be higher that the average construction industry volumes.

‘Annual Historic Sales Volumes’ have continued to fall over the past year from a peak of 82% in Q4 2021 to 43% of net balance in Q2 2022. Over the last year CAB members have continued to remain ahead of the wider construction industry.

For the first time since emerging from the Coronavirus lockdowns, the wider construction products industry is forecasting a slowing of sales. On net balance -33% for the next quarter and -33% for the year ahead. This is in stark contrast to CAB members who still remain very optimistic reporting a 52% increase on net balance for the next quarter and 38% for the year ahead.

Traditionally, as the large construction companies forecast a slowing in activity in new build, fenestration products continue to remain high to supply projects already within the construction cycle. However, this could be said for some other construction products, however, heavy-side products such as concrete and steel are needed at early stages of construction which will influence figures from the construction products industry.

‘Sales Volumes – Quarter-on-Quarter’ follow the ‘Historic Sales Volumes’ report and show an increase in sales of over 5% by 67% of members in Q2 2022 compared with 46% in Q1 2022. ‘Sales Volumes – Year-on-Year’ shows a similar picture but with no members stating that sales had decreased over the period.
‘Historic Unit Costs’, quarterly and annually have remained reported between 88% and 100% each of the last four quarter reports by members and the wider construction products market. Across all construction products, the report indicates that on average 80% of all companies expect unit costs to continue to increase in the next quarter and in the year ahead.

Under ‘Cost Factors’ members indicate fuel as the most influential at 100% on net balance of respondents, this is followed closely by wages , salaries and other energy costs. It is notable that Q2 2022 material costs have softened to 76% on net balance down from an average of 90% in the previous three quarter reports.

Reporting on the ‘Likely Constraints on Activity Over the Next 12 Months’ 57% of respondent state that continued demand as the biggest threat. Whilst material supply has been an issue over the past quarterly reports for members, this has dropped to just 10% of members who now claim that this could be a future constraint.

‘Historic Capacity Utilisation’ and ‘Expected Capacity Utilisation’ which reports on the proportion of members operating at over 90% of capacity continues to indicate that CAB members have a greater capacity for production against that of the wider construction products industry. That said, CAB members are forecasting that their ‘Expected Capacity Utilisation’ will increase in the next quarter and year ahead.

Whilst the pressure on ‘Labour Costs’ continue to rise, it is interesting to note that in the year ahead across the wider construction products industry ‘Labour Force’ is set to reduce by 11% on net balance of respondents to the survey. CAB members remain positive indicating an increase in labour at 43% on net balance of respondents.

‘Historic Exports’ and ‘Expected Future Exports’ indicate that CAB members continue to see growth in this sector whilst the wider construction market see no ‘Expected Future Exports’ change, but has seen a drop of 25% in the last year, on net balance of respondents.

Based at the picturesque Bonds’ Mill development in Stonehouse, CAB staff are always on hand during normal working hours to answer any membership, training or technical aluminium fenestration related questions. News and event information is regularly updated on the CAB website at www.c-a-b.org.uk and also in the Association monthly ezine ‘A Window Into Aluminium’ which is free to sign up to. If you are not a member of CAB and wish to learn more about membership, please contact Jessica Dean at the CAB offices by email jessica.dean@c-a-b.org.uk or telephone Jessica at the office on 01453 828851.

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