BMF BMBI Q1 2017 Report and Comment – OUT NOW

BMBI Expert Andy Williamson, Group Managing Director IKO plc, comments exclusively on Roofing Products for Q1 2017.

The lack of the UK’s usual winter storms in the first quarter of 2017 means there’s been a lot less demand for roofing felt in the domestic market, with the result that this sector is significantly down year-on-year. The latest CPA figures show a net 31% of main contractors reporting lower orders year-on-year in all sectors in Q1 2017, apart from housebuilding, which has remained resilient. However, the milder weather has also allowed some commercial specification RMI work to start earlier than it would do normally.

The CPA also reported that 86% of contractors and 93% of manufacturers have seen raw material price rises year-on-year.

The next quarter is likely to feel the effects of the General Election and the triggering of Article 50. According to RICS, the construction industry could lose nearly 200,000 workers from the EU if we fail to maintain access to the single market . EU workers make up around 8% of the construction industry – possibly more in roofing. They make up a much higher proportion in central London too, so this could threaten some major infrastructure projects and exacerbate our current skills crisis.

We are seeing a growing trend in the market for flame-free flat roofing solutions, particularly for self-adhesive options. This trend could be linked to the skills shortage, as merchants have reported that general builders are being asked to tackle projects that might typically have come under a specialist roofer’s remit. Flame-free options are usually quick, easy and safe to install compared to torch-on products which require specialist skills.

Finally, despite the re-emergence of inflation, stagnating wages and anxiety over over-enthusiastic borrowing, consumer confidence has remained surprisingly stable in the UK in the past year, but it is a concern moving forward. GfK’s long-running Consumer Confidence Index dropped in April, with forecasts for personal finances and the general economic situation down year-on-year . It’s clear from the early skirmishes between PM Theresa May and European Commission President Juncker that we’re going to have to get used to living with a high degree of uncertainty for the next two years as negotiations trundle on. However, the benefit of a snap Election does mean we don’t have to wait long for some of the uncertainty to be resolved.

Download the full 2017 Q1 report here