Steel, bitumen, cast iron, rebar and timber supply issues along with rising cement, bricks and blocks and glass costs are likely impacts of the conflict in Ukraine.

The Construction Leadership Council, CLC, is urging contractors and suppliers to work together to overcome these problems.

Arcadis partner and CLC member Simon Rawlinson said: “We hope to help companies navigate through these current challenges with guidance and points to think about, supporting firms in what could be a challenging period for the sector.”

The CLC has said construction enterprises at all scales, from the largest tier one contractor to the smallest repair and maintenance specialist are affected.

Although the UK imports less than two per cent of construction materials from Russia, Ukraine and Belorussia it is dependent on European manufacturers sourcing from these markets. Russia’s copper and timber enters the UK supply chain via EU processing companies which are affected by supply issues and rises in wholesale energy prices.

Inflation risk should be spread through supply chain

Manufacturing shutdowns because of uneconomic operations due to high energy costs are expected. Disruption to pricing models and short-term requirements to secure raw materials at spot market prices are also predicted.

The CLC has produced guidance notes for contractors, sub-contractors and clients to help the building industry manage the crisis caused by Russia’s invasion of Ukraine.

It is advising sharing the risk of inflation through the supply chain making future projects more resilient. It argues collaboration will improve transparency and information quality, supporting better decision making.

Property finance Brokers Hank Zarihs Associates said identifying potential problems and planning ahead would be something development finance lenders would be keen to see.

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Shiraz Khan