Thought the strains on the supply were bad enough? They’re about to get worse.
We are well aware of the problems in the PVC resin market, glass, steel etc. These have gradually got worse during the course of the year. Now the Scottish market is back, those strains are going to become worse as the fenestration sector in Scotland begins to flood manufacturers with orders. On top of that, we have two float lines down at major glass suppliers at perhaps the worst possible time.
As a result, there have been multiple warnings this week about shortages in the laminated and IGU areas of glass.
There is growing consensus that the current levels of high demand will last throughout the whole of 2021. It’s also logical to consider that as we approach the months with better weather, the number of homeowners starting their home improvement journey will only increase, especially now Scotland has come back online. There is serious concern about whether the supply chain can cope, and how long lead times will continue to stretch out to.
Specifically, in the glass space, two companies this week have issued warnings about major shortages. First, Mackenzie Glass have spoken about immediate shortages in laminated products:
The glass merchanting business said that major disruption to the supply of PVB laminates in the US had created a global shortfall, which was now manifesting itself in lower availability of security and acoustic glass.
Compounded by further disruption to supply caused by the recent blockage of the Suez Canal and the exponential growth in demand for laminate products from the automotive industry, home improvement and new build sectors.
Mark Herbert, Joint Managing Director, Mackenzie, said that glass processors and IGU manufacturers should ‘brace themselves’ for a summer of shortages.
“I’d like to be able to say that we won’t be affected but our supply of laminates is already limited and that’s going to get worse before it gets better” he said. “The positive is that we have strong partnerships and a number of different suppliers and we’re in a position to support our established customers and to take on a limited number of new ones.
“But we are on allocation from our suppliers and are applying the same restrictions to our customers as part of our onward supply agreements to prevent stock-piling and make sure that the product is there to go around.”
For those in the commercial area of fenestration, shop front installations and companies who specialise in acoustic glass, this is going to be a major and imminent problem. Especially considering the amount of work already booked in.
Cornwall Glass also issued a similar warning for the IGU sector:
With two of the UK’s three float glass manufactures already limiting supply of laminated products, Mark Norcliffe, Joint-Managing Director, Cornwall Glass Manufacturing, said that the IGU sector faced a summer of uncertainty.
“We’ve seen massive demand for laminate glass from our own sector, which has placed pressure on supply. At the same time supply has been disrupted by reduced manufacture of PVB resins, particularly by a single US manufacturer and the supply that has existed has been swallowed up a resurgent automotive industry
“This created significant pressure on supply at the end of this month [April], which we expect to continue for the next three months at least”, he said.
“We have been working closely with Saint Gobain, our main supplier and we are confident that we will have enough product to continue to meet reasonable customer demand, but it is tight and for much of the industry, I believe it’s going to be very bumpy in the months ahead.”
Although this has always been the case, we’re very quickly relearning how reliant we are on every single component that goes into the entire supply chain. In normal times, most people won’t have given much thought to PVB resins. Now, the word “resin” is in the minds of many, and we’re learning how a shortage in one particular material can upend whole processes and products.
Right now, there are decisions being made at the very top of supply chains. Raw materials are very precious commodities right now, and choosing who to send product to is becoming a business decision.
In short, when companies are having to choose who to supply to first, they’re going to side with those who pay well and on time, are loyal and with those who paid their bills during the first lockdown and during the pandemic in general. This is where the real value in relationships and partnerships is seen. It’s also going to mean a tough time for companies who are not at the top of the priority list when it comes to supply. Some companies are going to be seeing shortages very soon according to the warnings above.
With lead times for installers already way into the summer and early autumn for some, any delays in the glass sector could push those leads times even longer. We do have to start wondering how long people are prepared to wait for their new windows and doors. 12 weeks seems to be manageable. But what if we get to 16 weeks? 20 weeks? Will people still be as patient? Only time will tell.
This is where planning well ahead is going to protect companies. Installers need to add a few percent to their contracts to protect themselves against future price increase. Fabricators need to plan as far ahead as possible when it comes to materials. Systems companies need to communicate to their customers what they’re able to deliver on. Plan now, anticipate what we can, make some headroom and communicate well. It does look like this is going to be the norm for the rest of the year, so we all need to work together to make sure we can all pull through this period as unscathed as possible.
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