 |
 |
||||||
[July 2000]
The provisional results from the Construction Products Association's quarterly State of Trade are encouraging
The provisional results show that:
A positive balance of the major companies in the industry saw output increase in the second quarter of the year Growth was strongest amongst lightside manufacturers A positive balance of 50% expected third quarter output to be higher than a year earlier
Commenting on the results of the survey, Allan Wilén, the Construction Products Association's Economics Director said: "These provisional results paint an encouraging picture in terms of industry output, although few companies are seeing rapid growth and price competition remains strong. The industry is in a good position to respond to the much needed increases in investment in the built environment that we have been pressing for in the Comprehensive Spending Review".
The survey also showed that output increases for lightside manufacturers have not been reflected in higher prices and, faced with competition from cheaper imports encouraged by the strength of Sterling, manufacturers on balance saw prices fall compared with a year ago. On the heavyside, a modest price recovery reflects increasing costs, with three-quarters of companies reporting they have faced higher costs over the last 12 months. Much the same picture emerges on exports with the vast majority of lightside companies, the main exporters in the sector, reporting volumes in the second quarter as good or better than a year ago. Manufacturers' efforts to maintain and improve export volumes, however, have been accompanied by lower prices.
Looking to the future, Wilén said: "the industry is positive about prospects over the coming year. A balance of 50% of companies believe output will be higher in the third quarter, whilst this positive balance increases to nearly 60% when looking a year ahead. Optimism is particularly strong amongst lightside manufacturers. Overall, however, few companies expect output to increase in this period by more than 5% from what is generally a low base".
Turning to exports, he said: "the industry is optimistic with nearly three-quarters of companies expecting export volumes to increase over the next 12 months. Recent modest falls in the value of Sterling will undoubtedly assist in this, although it will take some time for the real benefits to work their way through".
The Construction Products Association:
The Construction Products Association represents the UK's producers and distributors of construction products, components and fittings. It acts as the voice of the construction products sector, representing the industry-wide view of its members. The Association is committed to demonstrating the importance of a growing, profitable and sustainable construction products sector within the UK economy.
ENDS