Why are Industrial Storage Solutions costs on the increase?
Excessive demand for some core building materials such as steel is now outstripping global supply ability.
At the beginning of May 2021, the UK manufacturing trade association British Electrotechnical and Allied Manufacturers Association (BEAMA) commented that a dramatic reduction in steel production early on in the pandemic cycle during 2020 had caused a global shortage, though output started increasing in mid-2020.
The association said that the “availability of steel remains problematic”, which is set to continue for months before it eases. British Steel stopped taking orders on structural steel sections due to “extreme demand” last week and a director of a steel specialist told Constructions News that he was worried the move will lead to “panic buying”, making the situation worse.
As availability has dropped, prices have increased. According to BEIS, the price of fabricated structural steel was up 17.6 per cent higher by March 2021 since the previous year. The Electrical Contractors Association (ECA) said this month that demand for cable steel had soared as companies rushed to complete projects they were forced to halt due to the pandemic. ECA chief executive Steve Bratt said: “Our advice is to order the materials you need in good time to ensure you can finish as planned.”
This gives us a clear overall picture as to the market changes and explains why there is an increase in costs for steel currently.