24/09/2020

New figures reveal a ‘no deal’ Brexit could have a significant economic impact on the manufacture and supply of building materials across the UK in 2021.

Forecasts from the Builders Merchants Federation (BMF) point to a 2.8 per cent increase for the sector next year if an agreement is not reached, against a 5.9 per cent increase if a deal is struck with the European Union.

The figures are revealed in the latest issue of the BMF’s market data report, the ‘Builders Merchants Industry Forecast,’ which analyses both scenarios relating to the UK’s exit from the EU.

While Q1 of 2021 forecasts substantial or slight declines depending on the outcome with the EU, a more positive outcome for Q2 next year is predicted, with a bounce back of 17.9 per cent or 11.3 per cent reported, subject to the way Brexit is delivered.

John Newcomb, BMF CEO, said: “This forecast report is a comprehensive analysis of merchant market performance from July 2014 to June 2020, coupled with an analysis of the key factors affecting builders’ merchants to project future sales from July 2020 to December 2021.

“Interestingly, both Brexit scenarios, deal or no deal, expect a subdued start to the year, with strong performance expected in Q2 largely affected by poor Q2 performance this year.”

The BMF’s Builders Merchants Industry Forecast provides a comprehensive analysis and forecast of the builders’ merchant sector.

It includes key statistics, as well as the general economic performance and outlook, with commentary on inflation, wage growth, the labour market and economic growth.

Detailed information includes a valuation of the merchant share of both the UK Building Materials Market and the Plumbing and Heating Market 2019.

The BMF has also worked alongside the Department for Business, Energy and Industrial Strategy to develop a forecast for the remainder of the year using data from national merchants and large independents, as well as buying groups and housebuilders.