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Page 19 Contractors World - UK & Ireland Vol 2 No 1

on construction in 2012, the industry is now expected to see a fall in output of over 5 per cent this year, with no sign of recovery untl 2014.’

Exports help product manufacturers

The Construction Products Association’s latest State of Trade Survey shows that manufacturers, partcularly on the light side, are beneftng from an increase in export actvity to of-set the subdued level of constructon actvity in the domestc market.

34% of light side and 17% of heavy side manufacturers recorded growth in overseas sales during the past year and a further 55% and 71% respectvely maintained export levels in a compettve global marketplace.

Commentng on the fgures, Constructon Products Associaton senior economist, Kelly Forrest said: ‘Against a difcult domestc backdrop, it is encouraging to see that exports are growing strongly, especially considering that export growth is a fundamental part of the government’s economic strategy. Furthermore, constructon product manufacturers have invested heavily in developing trade links beyond the eurozone and, in Q4, 35% of light side manufacturers with export links sold products into the Asian market, a very high proporton by historical standards.

‘Future prospects for the UK industry, however, remain very uncertain, as cuts to public sector capital budgets impact on the ground and weak economic growth constrains the private sector recovery.

‘Strong input cost infaton also added to the pressures on manufacturers as price increases in raw materials, energy and fuel all had a signifcant impact on manufacturing costs.

‘Manufacturers of heavy side products, typically used in the early stages of the constructon process, reported that conditions were challenging in Q4 but 2011, as a whole, was a better than anticipated year, due largely to publicly-fnanced work in progress feeding through more slowly than expected and strong growth in export actvity. However, the cuts to public sector capital budgets are now having a tangible impact on the industry and demand from the eurozone, our largest trading partner, remains highly uncertain.’ Other key points include:

• -22% of heavy side manufacturers, on balance, reported that sales fell in Q4 (compared with Q3) and 35% reported no change in actvity

• In contrast, +22% of light side manufacturers reported sales growth in Q4

• In the next 12 months -3% of heavy side frms, on balance, expect sales to fall, whereas +20% of light side foresee growth

• 47% of light side and 82% of heavy side frms expect unit costs to increase in the next 12 months, largely due to further fuel and energy price infaton

• 81% of light side manufacturers expressed concern about the strength of future demand

New Entrants Essential if Green Deal to Work

Responding to the Government’s Green Deal and Energy Company Obligaton consultaton, the Constructon Products Associaton has acknowledged the enormous potental Green Deal could bring in improving the energy performance of UK buildings, but gave a cautonary warning that there were some fundamental issues that stll needed to be addressed.

Responding to the consultation, John Tebbit, (right) Industry Affairs Director at the Associaton said: ‘We all know that Green Deal has the potental to be a real game changer, but government must accept this is a long-term soluton and not a quick fx opportunity. “It is essental that the Green Deal allows new companies and organisatons into the market, such as distributors, builders, manufacturers and installers. This will avoid any one part of the supply chain enjoying a dominant positon in energy efciency work; it will bring greater competton and encourage diversity.

“There must also be a process for ensuring product and installation quality allows

innovative products and solutions to be introduced to the market whilst ensuring performance.

Products and systems that already meet British and European standards, or are certified to reputable third party schemes, must not face additonal testng or registraton costs.

To make the Green Deal work, targeted fiscal incentives will need to be brought in and the Association has long

Construction News - Economy - Business - Regulation

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