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Sun November 28 2021

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Steelwork costs rise 17% in three months

10 Nov Research by Southern Construction Framework (SCF) shows how the rising cost of materials is making it nearly impossible for contractors to forecast and fix building costs.

Latest quarterly report from SCF says that the cost of steelwork has gone up by a further 17% in the last three months alone and 38% over the last 12 months.

SCF is a construction procurement framework for the public sector in the south of England. Its latest quarterly report is based on data from July to September 2021 in partnership with its main contractors – BAM, GallifordTry, ISG, Kier, Mace, Midas, Morgan Sindall, Sir Robert McAlpine, Wates and Willmott Dixon.

The SCF contractors describe the market volatility and the rate of price increases as ‘truly unprecedented’, with some referring to subcontractors fixing prices for just 24 hours, making planning across the industry impossible.

For the third quarter of 2021, SCF main contractor’s supply chains have reported an average building cost increase of 12% across all trades – due to a combination of inflation rates across numerous products and materials. The price of some raw materials, specifically metals, has continued to impact on the building costs of many trades and products.

Trades that have seen the greatest increase in Q3 when compared to the previous quarter include Steelwork (17%); Carpentry & Joinery (16%); Curtain Walling & Dry Lining (14%); Windows (13%).

Over the last 12 months the greatest annual building cost increases have been found in Steelwork (38%); Dry Lining (18%); M&E (16%); Carpentry & Joinery (15%).

Kingsley Clarke, SCF operations lead, said: “The cost of steelwork has shot up in the last year and in the next quarterly report due out in December, this is likely to be up again, given British Steel’s new surcharge in response to the mounting price of gas and transportation. Whilst it is temporary, a £30 per tonne price increase on already inflated costs is the last thing that contractors need in addition to all the additional knock-on challenges of materials and labour shortages and rising salaries.”

Different surveys come up with very different results. According to Roofing Megastore, building materials prices have been much greater than Southern Construction Framework’s research suggests. It says that the cost of repair & maintenance work in the UK increased by 26% in October 2021 compared to 2020.

Year-on year price increases according to Roofing Megastore

Material YoY Increase (%)
Imported sawn or planed wood 74%
Fabricated structural steel 73%
Particle board 65%
Concrete reinforcing bars (steel) 62%
Imported plywood 56%
Builders’ woodwork 14%
Plastic for doors and windows 13%
Precast concrete products 12%
Non-aqueous paint 11%
Flexible pipes and fittings 8%

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