We are currently experiencing an extremely challenging and difficult time for the industry. Under normal circumstances, we would all be enjoying the fruits of one of the busiest periods the industry has ever been through. Demand from the home improvement sector has been unrelenting since the middle of last year and it is still extremely high 12 months later.
The housing market has been absolutely booming since the introduction of the stamp duty holiday, and it shifted into an even higher gear this spring. Some of the stories in the press are hard to believe, with desperate homebuyers putting down huge deposits just to secure a viewing or offering the full asking price without even stepping foot in the property they are looking to buy. That’s combined with a forecast of an explosion in consumer spending as the UK emerges from Covid restrictions. The Bank of England is predicting the fastest rate of growth in over 70 years.
The challenge, as we are all aware, is how to satisfy this demand when there is such immense pressure on the supply chain. The issue of PVC system supply, which is being driven by a shortage of polymer, is not unique to the UK. It’s one that is affecting all of Europe, in fact, it is being felt globally, and it’s not even exclusive to the window and door industry. You may have read about some supermarkets removing plastic carrier bags recently. This a positive step forward for sustainability. But it’s one that has been accelerated due a lack of plastic to make the bags in the first place.
As a result, the introduction of surcharges has been inevitable. The price of polymer has been going up, month on month, for the last year. While we have absorbed as much of that as possible, bringing a small surcharge into the market has been unavoidable. We plan to introduce our first and only surcharge in June.
I fully understand that this is not the news our customers would hope for, although I would like to stress that no one is immune from this situation and with the scale of our resources, we are much better placed than others to manage the situation.
Aluplast is global company. We process more than 200,000 tonnes of PVC-U each year and we export to 28 countries. This means that, compared to some of our competitors, we have kept the introduction of surcharges to an absolute minimum.
From Aluplast’s perspective, we are probably at the peak of the crisis. We anticipate that demand could actually start to ease by mid-summer. In the meantime, we will continue to work hard for our customers, making sure they are as well equipped as possible to make the most of current conditions, but also to ensure they remain in a strong position once market conditions eventually return to normal.
Ian Cocken
Director of sales and marketing, Aluplast
