Red Sea conflict could drive up construction material prices
A drawn-out conflict in the Red Sea could have an impact on the supply and price of materials used on UK construction sites, an expert has warned.
Reports were circulating on Monday (15 January) afternoon of a US-owned cargo ship being hit by a missile near the Yemen coast.
This came just days after the Royal Air Force joined US-led military action against facilities used by Houthi rebels accused of a series of attacks on shipping in the region.
Construction Products Association economics director Noble Francis warned that a long conflict in the area could make it more difficult and expensive to import certain materials.
Delivery prices have already soared, with one shipping marketplace showing a trebling in the past month of the cost of bringing a 40ft container from China to northern Europe.
“If disruptions persist, it will significantly affect some imported products through delayed supply and [further] rises in freight prices,” said Francis.
The UK imports more building products from China than from any other country, with the primary shipping route from Asia heavily reliant on the Suez Canal and the Gulf of Aden.
“Construction product prices are still high so if the disruptions persist in the Red Sea, it could lead to some delays and construction product price rises, exacerbating problems for some housebuilders and contractors in 2024,” said Francis.
Although three-quarters of products used on UK construction sites are made in this country, some rely on parts from abroad, he pointed out.
Francis added: “Manufacturers using imported materials, or components and product importers, will be keeping a keen eye on [the conflict] to see if it is a temporary blip or has effects over the course of months.”