2017 was a good year. UK manufacturing rode a high. Supply issues from the Far East also delivered opportunities to capitalise on. The indicators even showed that manufacturing grew quicker than the beloved services sector.
2018 promises to be a different beast. Currently we’re not feeling anything different, but the forecasts warn for a rocky road. Here’s what we’re seeing:
INDUSTRY GROWTH: The UK economy and in turn UK construction in 2018 has been forecasted for slow growth, particularly in the private sector. A continued fall in real wages will mean less investment from consumers in current and new housing, which combined with a slow UK economy will dissuade foreign investment.
MATERIALS: Raw material prices will continue to rise throughout 2018. The increase of electric vehicle and renewable energies markets will keep demand for base metals high. Copper is still in an up trend, which indicates the rest will follow.
BREXIT: Uncertainty still impacts on the market, but on the whole, public sector works is going ahead. The threat of tariffs still loom, which adds to the uncertainty. However trade with Europe and further afield has not yet been affected and we don’t see this changing.
SUPPLY CHAINS: Supply chain from the Far East are still under threat via ongoing environmental issues, impacting on projects back home that rely on that supply. Good news for UK based manufacturers who will not be affected by this and can offer better service, particularly those sourcing raw material more locally. For us we are already seeing a strong return to local sourcing and we are excited for that to continue.
MANUFACTURING: Manufacturing is experiencing strong growth. Order books are full and are projected to increase. This charge is led by demand for exports still running off the back of the drop in the value of sterling since Brexit. However, sterling has slowly recovered since reducing this advantage. Nevertheless, new and old customers have revisited UK manufacturing and we keep our positive outlook.
FLOWFLEX: Manufacturing is full of uncertainty, but with a positive outlook for UK manufacturing, everything sits well for us. Material prices are still high, but our entire offering remains robust. Our customers will still be here in the year to come, as they have been before. They will chart their own course and we will continue to support them with our excellent service to deliver their success. We’ll all crack on together and muscle through the mess!