Inside Housing – Insight – Will soaring metal costs slow siding sanitation?

Headache for BSF candidates

Elsewhere in the country, renters are mired in similar issues. In a building in the North West of England, tenants have been warned that delays in repairing their building are likely to drive up prices.

“The longer this situation continues, the more likely we will be affected by cost increases due to inflation,” the tenants said in an email from their management company and seen by Inside the housing.

He added: “There is a risk that the contractor decides to withdraw from the project. This would mean that the works would have to be re-tendered, which could have further cost and program implications. »

Scott Mason, founder of Clad To Help, which advises on reclamation projects, is aware of the issues.

“Contractors are overwhelmed with demand for remedial work and wider supply chain issues are affecting material prices and lead times, creating a headache for Building Safety Fund (BSF) applicants who find themselves running after them,” he said.

It echoes Ms. Saha’s experience with quotes from contractors. “In the current climate, contractors can’t sustain their price as long as they would have a few years ago,” he says.

“I had a situation where I just wanted a small amount of metallic coating for training purposes, which I would normally have gotten in a week. But it got to the stage where there was an eight week wait”

Other difficulties are found in this matrix. Contract negotiations between applicants and a contractor often cannot be finalized until a grant is officially offered, says Mason.

“But this offer may be months after the second stage of the fund has been submitted due to prolonged governance,” he says. “It is only at the conclusion of contract negotiations that the price effectively becomes locked in between the claimant and the contractor, whereas the amount requested and offered by the OSB is based on the contractor’s offer price. reconstructed months before.”

Mr Mason says that with his own situation, they have included a 3.5 per cent contingency allowance to cover cost increases in the four months before submitting a claim to the OSB. However, he says, the contract price increased by more than 6% by the time the work was due to be done. “We had no choice but to dip into a separate general provident sum that was earmarked for other unknown risks,” he says.

Tying contractors to get the job done is also a recurring theme. Giles Grover, from the End Our Cladding Scandal campaign, says, “I think some entrepreneurs can almost pick and choose which projects they work on, because there are so many.

Lately, the issue of rising material costs has also loomed on the horizon. This was a problem before Russia invaded Ukraine, but has since been made worse by the conflict.

Steel prices, in particular, surged as supplies were disrupted across Europe, with Russia the world’s fifth-largest steel producer. Meanwhile, in March, British Steel raised prices by 25% – reportedly its largest one-time increase on record.

“Just because you’re seeing a double-digit increase in material and product costs doesn’t mean you’re seeing total construction costs go up by double-digits”

Noble Francis, economic director of the Construction Products Association, says steel and aluminum have been hit by a double whammy from a spike in commodity and energy prices, with both materials being commodity commodities. high energy intensity.

He thinks there could be ‘significant impacts’ on surfacing remediation projects next year, although he suggests the spikes could even out over the next six months if there isn’t. no other occasional shocks.

He is, however, keen to point out that two-thirds of contractors’ costs are usually labor costs. “Just because you see double-digit increases in material and product costs doesn’t mean you see total construction costs increase in double digits,” he explains. “Labour costs are still in single digit inflation.”

Carlton Jones, director of the Metal Cladding and Roofing Manufacturers Association, says he has also noted the sharp rise in steel and aluminum costs since Brexit and the pandemic.

He saw the price of some steels double from £800 a tonne to £1,600 a tonne. “I know of a coated steel supplier who quadrupled their prices in eight or nine months,” he says.

“Brexit is not sorted”

Lead times have also been an issue. “I had a situation where I just wanted a small amount of metallic coating for training purposes, which I would normally get in a week,” says Jones.
“But he got to the stage where there was an eight-week wait.”

It also depends on where the products come from. “The steel supply could come from the UK, Europe or the Far East. And people might feel like Brexit is sorted, but as far as the industry goes, Brexit is not sorted. Trade agreements, customs and CE marking are all problematic. »

Jonathan Evans, managing director and president of coatings supplier Ash & Lacy, notes the significant impact of the war in Ukraine.

“One of the biggest aluminum manufacturers in the world is Rusal (headquartered in Moscow),” he says. “But obviously, because of the sanctions, that means around 12% of the global aluminum supply is affected. This does not help the situation. »

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