Last year’s COVID-19 pandemic, compounded by Winter Storm Uri in Texas, severe weather in the Midwest, high consumer demand, a container shortage, embargoes, employee shortages, and the Suez Canal blockage created the perfect storm that led to today’s challenging construction environment, according to presenters at a recent workshop hosted by Western Specialty Contractors.
Representatives from Western Specialty Contractors, Sika Corporation, and Rooftech/Pavetech Consultants conducted a workshop in June outlining the circumstances behind the construction industry’s product shortages, long lead times, and price increases, plus offered their outlooks for the year ahead. The online workshop was offered free to facility managers, building owners, and customers.
Much of the nation’s construction projects were halted by the COVID-19 shutdown in 2020 when devastating Winter Storm Uri crippled Texas in February 2021. The complete shutdown and damage to manufacturing plants in the state halted raw material production for several weeks, which in turn caused construction material manufacturers, such as Sika, to produce less for their customers. A dip in Texas’ oil refinery production was also a major contributor to the raw material shortage, according to workshop presenter Mike Mastro, Vice-President of Sika Corporation. Sika is a specialty chemicals company based in New Jersey that manufactures concrete admixtures, specialty mortars, epoxies, structural strengthening systems, sealants, adhesives, and more.
“Much of the manufacturing plants are built around the oil refinery industry, meaning that a lot of these raw materials such as PVC, Poly O, MBI, TDI are centered around oil and that centered around Texas,” said Mastro. “After companies were able to start back up, they started allocating the raw materials to manufacturers to make products, so that is where the time lags started, and while we have an increased demand for our products year over year of 20 percent, we now have a reduction in the ability to manufacture products by about 80 percent due to the shortage of raw materials.”
Strong consumer demand, combined with raw material shortages, freight delivery backups, and a tightening of the labor market will continue to challenge the supply of construction materials through the summer, with prices predicted to rise consistently through mid-2022, according to Mastro.
Workshop presenters offered their advice on the best ways for facility managers and owners to move forward with 2021 capital improvement projects considering the year’s unprecedented challenges.
“We recommend getting the project under contract and moving forward with an open mind,” said David Grandbois, Assistant Branch Manager at Western’s Minneapolis Branch. “Plan ahead for long-lead items, identify them early and get in a contract with the pricing for those items. Keep an open dialogue between the consultant, owner, and contractor as things change daily and hourly. And finally, be flexible to allow for material price increases as they come along.”
Tanya Shepherd, Senior Business Development Manager at Western Specialty Contractors, added that communication between the manufacturer, owner, and the contractor is key to navigating today’s construction environment.
Transparency about what can and can’t be completed on a project is one of the best ways to move forward, said Mastro.
“A lot of these projects, you normally have a monthly project meeting, it should probably be bi-weekly or weekly now because this process is changing and it’s so dynamic and changing so fast that I think it is important for everybody,” said Mastro. “From the manufacturer to the specifier to the owner to the contractor, everyone should be having these conversations together because I think it is going to require a lot of creativity to move around the job site in a different order or focus on different things.”
View the complete workshop below:
About Western Specialty Contractors
Family-owned and operated for more than 100 years, Western Specialty Contractors is the nation’s largest specialty contractor in masonry and concrete restoration, waterproofing, and specialty roofing. Western offers a nationwide network of expertise that building owners, engineers, architects, and property managers can count on to develop cost-effective, corrective measures that can add years of useful life to a variety of structures including industrial, commercial, healthcare, historic, educational, and government buildings, parking structures, and sports stadiums. Western is headquartered in St. Louis, MO with 30 branch offices nationwide and employs more than 1,200 salaried and hourly professionals who offer the best, time-tested techniques and innovative technology. For more information about Western Specialty Contractors, visit www.WesternSpecialtyContractors.com.