The Construction Leadership Council’s (CLC) Material Supply Chain Group has released an update on the state of the material supply chain
Most materials are readily available in the construction supply chain, according to John Newcomb, CEO of the Builders Merchants Federation and Peter Caplehorn, CEO of the Construction Products Association, and co-chairs of the CLC’s Material Supply Chain Group.
This, however, is due to subdued demand, simply meaning that supply remains good because far fewer contractors or developers are buying.
Housing is the biggest anchor
The statement highlights that construction output grew by 1.6% in the three months up to April, but despite this, persistent issues mean that a decline of 2-2.5% is expected in the rest of 2026.
The largest factor for this is housing, as demand for new homes remains low due to consumers being cautious, and mortgage approvals being down on a year-on-year and a month-on-month basis.
Infrastructure maintains a good pipeline; highway maintenance and repair remain strong, and data centres and digital infrastructure continue to grow, but the sheer weakness in housing is enough to offset these positive sectors.
Housing usually generates the greatest demand for several materials, including bricks, cement, and steel, but as demand for houses remains low, so does demand for these materials. Uncertainty also remains high, as several new regulations, while well-intentioned, risk adding further costs, complexity, and administrative burden to projects.
New steel tariffs and quotas are also becoming an issue, as tariff-free quotas have halved, import duties increased to 50%, and industry fears of product shortages are all reaching a head.
Read the full CLC statement here.
Housebuilding remains subdued
In spite of the government’s commitment to boost housebuilding and build 1.5m new homes in this parliament, numbers have barely grown and remain on a downwards trend. In May, the National House Building Council (NHBC) published figures showing that in Q1 2026, 26,959 new homes were registered to be built, a full 6% down year-on-year from Q1 2025.
Daniel Pearce, corporate strategy director at NHBC explains: “Our latest figures indicate house builders are taking a cautious approach to registering new plots as fragile consumer confidence, affordability challenges and global economic uncertainty continue to impact demand.
“It’s a perfect storm – the market is subdued, mortgage rates are rising and cost pressures on households are in full effect, exacerbated by geopolitics and recent conflicts. Resolving affordability challenges for homebuyers remains the key to unlocking demand. The market is crying out for some targeted stimulus, such as a new buyer incentive, to help those who need it most get on the housing ladder.
“At present, there is little incentive for developers to accelerate building. Easing certain regulatory requirements, at a time when other costs are rising beyond their control, is a lever that could be pulled to support home builders, particularly SMEs. Accelerating planning reforms is also crucial to help house builders deliver high-quality new homes at volume. The impact of the recent planning changes has yet to be felt.”
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