Aluminium industry players have shown a far less optimistic view of the industry’s near future compared with other construction sectors, according to the latest State of the Trade report from the Council for Aluminium in Building.

Only 32% of CAB members surveyed expected sales to increase in the current quarter, against nearly half (48%) in the wider construction industry.

The gap was even wider for reported sales in the last quarter however, with 36% of members reporting an upturn over Q3 against 85% across all construction.

The change could be reflecting the delay in which the supply of aluminium fenestration follows some time after building starts on site, the report suggests but adds that the year ended with a net balance of 14% of CAB members suggesting that sales volumes had reduced in the previous year.

“The main driving factor for CAB members remains the costs of materials and obviously the exchange rate, as much of the UK’s aluminium is imported, the report continued. “Looking forward as you would expect 62% of CAB members suggested that the demand for product would be the likely constraining factor in business for the next 12 months, reflecting the conservative figure in both reported historic and expected sales forecasts.

“Looking at capacity utilisation and companies that are operating at over 90% of capacity, less than 50% of CAB members suggested they were running at this level and there does not seem to be an expected improvement in the year ahead.  The wider construction industry is faring a little better, but the restrictions imposed by the Covid-19 outbreak continue to make business difficult for most.

“On balance 27% of members have indicated that labour costs during the last year have increased and on balance 64% of members expect that there will be further increases in cost in the year ahead.  Both historic and expected costs remain higher than that of the wider construction industry.

“Encouraging to see is the capital investment from CAB members in the year ahead, on net balance across all capital assets, is set to double in the year ahead suggesting confidence in the coming months.”

A recent forecast by the Construction Products Association anticipates that construction output in 2021 will rise by 14.0% with the largest growth rates in 2021 expected to be in infrastructure at 32%, public housing rm&i at 21% and industrial construction by 19%. The CPA’s main scenario for 2022 anticipates that construction output rising by a further 4.9% with the largest growth rates expected to be in public housing of 10.0% and industrial construction of 8.5%.

The CAB concludes: “In fenestration circles, whilst commercial new build and refurbishment outlooks may be a little cautious, there is a possibility that the home improvement sector could bounce back after the current lockdown as it did for the first lockdown in 2020.  With homeowners looking to spend capital, capital not spent on holidays, in improving their homes and property, these improvements often include replacement windows and doors.  Whilst still far from the most widely used fenestration material in the UK today, aluminium continues to grow and is arguably the material of choice for the homeowner given its affordability.”

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