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Revealed: Industry giants stockpiling ahead of Brexit

Developers, contractors and specialists are all stockpiling materials ahead of Britain leaving the European Union, Construction News can reveal.

CN has learned how firms across the industry are preparing for a potential devaluation of the pound in the aftermath of Brexit.

One of the UK’s largest building envelope contractors has lined up around £500,000-worth of metal to mitigate the threat of a post-Brexit price spike.

Stanmore Contractors, whose clients include Barratt, Berkeley Group and Taylor Wimpey, has reserved the metal to protect against a potential rise in material costs caused by a no-deal Brexit.

Speaking to CN, boss of the Kent-based firm Raj Manak admitted it was the first time it had taken such measures.

“We are trying to find clever ways of being more cost-effective and have bought some metal in advance [of Brexit] in case of any issues,” he said. “It’s in excess of half-a-million pounds, at least.”

Wembley developer Quintain is another company that has begun stockpiling a host of materials at its north London site.

Its construction director Matt Voyce told CN the firm had already started hoarding bricks, steelwork and cladding materials.

“We’ve done it with cladding materials, bricks, with steelwork and reinforcement, bathroom pods,” he said.

“We have those facilities already within the estate so if we see a particular challenge around getting a commodity to site we can forward-purchase and stockpile on site, if that’s something we need to do.”

NG Bailey chief executive David Hurcomb said his company had brought forward delivery of key plant and materials from the eurozone.

However, Mr Hurcomb added that the business was hamstrung by its pipeline of work, which restricted it to planning no more than two to three months ahead at any one time.

“We’ll effectively stockpile the important plant and equipment for current projects, but beyond that there’s not a lot we can do,” he said.

“You can’t go much ahead of that [three months] because you might not have the full specification of what you’re buying. You can’t buy way ahead, it’s not practical.”

Jason Knights, managing director of Wates subsidiary SES Engineering Services, told CN he had also begun forward-buying materials to insulate against rising costs rather than anticipating issues at customs.

“We’re forward-buying,” he said“We do that anyway when we see risks in the market and risks to the pound. It’s more about the cost rather than getting it into the UK.”

The Construction Products Association estimates around a quarter of materials used in UK projects are imported, with two-thirds of those from the EU.

CPA economics director Noble Francis has said a no-deal Brexit could lead to a double-digit rise in prices for imported products.

Last month, Barking and Dagenham Council’s regeneration company, Be First, revealed that contractors on its £1bn council framework would be given lay-down areas so they can stockpile supplies to mitigate the impact of a no-deal Brexit.

The framework provider had previously revealed it inserted a clause in its framework insisting all bidders show they have managed the risks of a no-deal scenario.

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