The latest Monthly Construction Update from the Department for Business, Energy & Industrial Strategy (BEIS), which continues to name the Builders Merchant Building Index (BMBI) as one its sources, is now available.
Highlights from the September edition of BEIS’ construction update include the latest BMBI figures, which showed that value sales in Q2 2019 declined by 1.2% in value terms against Q2 2018. This was driven by poor sales in the month of June, which was down by 8.1% year on year. Year to date figures still show value growth against 2018 but this has slowed down to 2.1% with price inflation the driver as volume continues to slow.
Overall performance in the construction industry was also less positive. The Office for National Statistics’ provisional estimate of construction output for July 2019 showed that construction output Construction output decreased by 0.8% in the three-month on three-month all work series in July 2019; predominately by a fall in repair and maintenance of 2.2% with a minor contribution from a 0.1% fall in new work. In the monthly series, construction output increased by 0.5% in July 2019.
Also included in the construction update is the latest edition of the Monthly Statistics of Building Materials and Components, which is published by BEIS. This showed that annual materials price inflation in July 2019 was 2.2%, down from 3.0% in June. The biggest price increase was for insulating materials (thermal or acoustic) which rose by 13.1% compared with June 2018. The biggest decrease was for electric water heaters which fell by 17.1% over the same period.
Moving onto indicators for August, there were more downbeat news in IHS Markit CIPS’ latest construction purchasing managers index. This showed that construction sector PMI in the UK fell in August 2019 to 45.0, down slightly from 45.3 in July and registering below the 50.0 no-change mark for the fourth consecutive month. This was led by the sharpest reduction in new work since March 2009. Business expectations for the year ahead have weakened sharply since July and were the least upbeat since December 2008.
The construction update report from BEIS is available for download below, or on the Construction Leadership Council’s website.
BMBI, a brand of the BMF, is the most reliable source of data for the RMI market. It reports on merchants’ sales to builders and other trades using data from over 80% of generalist builders’ merchants, by value. The merchants provide sales data to GfK’s ground-breaking Builders Merchant Panel and MRA Research uses this data to produce monthly and quarterly reports. Leading industry experts are also a key part of the Index, speaking for their markets, explaining trends and adding context to the data.