First steel, now plastics prices soar

BEAMA Installation’s Cable Management Product Group has warned of major price rises in the plastics cable management equipment market. This follows 50% cost increases over the last year.

The Group recommends a series of measures including that purchasers buy branded pvc-based products from reputable suppliers, check availability, confirm prices and be prepared for further price increases.

The massive economic boom in China and the Far East first placed a huge strain on the steel industry, creating record demand and pushing prices to new highs. Now, that same boom, coupled with oil price hikes and the high value of the pound against the Euro has inflated the price of plastics products dramatically too.

Echoing the concerns of sister steel products group members, the plastics sector has stressed that its aim is to continue providing the expected highest standards of product quality and support. However, it also emphasised the need to ensure that businesses remain profitable so that they can invest in plant, equipment and new product development.

Another factor adding to the price rises is the consolidation in the European resin producers market. Twenty-five years ago there were 20 European resin producers. Now, because of closures and amalgamations there are only five. In recent months, two of those five producers have made unplanned shutdowns, further reducing stocks.

m Newey & Eyre is urging contractors to avoid quoting fixed prices in order to avoid suffering financial losses due to rising steel costs. In the past year the price of a tonne of steel has risen by 60%. Shortages of the raw materials – iron ore, scrap and coke – have seen prices reach levels last seen in the 1990s.

Kevin Norman, product marketing manager at Newey & Eyre, says: “The industry faces a volatile situation with prices valid for as little as a few weeks. Installers should recognise this and try not to quote fixes, or if they do, include a proviso that prices could rise.”