Page 31 - HW Oct 2022

below cost for all the reasons already stated....
Some are also reporting DIY retailers and merchants pushing back
hard when it comes to discussing prices in a volatile marketplace. Some of this push-back may be justified, however, with more
than one supplier saying there is a fine line between putting price increases through because it seems like a good opportunity to squeeze through another 10% as opposed to putting them through when you are getting hit hard on your raw material and shipping and freight costs...
Despite all the price rises, says Bostik’s Paul O’Reilly: “It seems to me that the New Zealand market has just sucked them up – it might not like them, but both the DIY market and the trade do seem to have gone well.”
“Price is always an issue,” states Selleys’ Darren Newland, adding that shipping as a key costs factor is “an ongoing challenge,” and suggesting that shipping issues could well continue as is for the next 12-18 months, what with the situation in Europe.
A STICKY OUTLOOK?
So, what is the general outlook for the glues, silicones & sealants market for the coming months?
Will Paul O’Reilly offer an outlook on this for the year ahead? “I can’t crystal ball gaze, but I think next year is going to be very steady again,” he says, although foreseeing more issues with supply chain, and more rises in shipping costs.
What are Melanie Reid and Soudal’s expectations for the coming six months?
Consents will be stable, supply will improve, and shipping will remain challenging in terms of timing but improved in terms of pricing (“fingers crossed”) is the response, although some impact from inflationary pressure on DIY could see a reduction in demand due to less discretionary spending and, if bank pressures continue, that will act as “a handbrake to speculative residential housing.”
Although recognising our full or possibly over-full pipeline of building work, the view of Tony Smith at Sika NZ is that the market is probably going to be “quieter than it has been for the last 18 months.”
Tony expects conditions may be “a little bit tougher next year” but also accepts that “there’s still a bit of a positive feel about the industry.”
“It’s a challenging environment and fast-moving,” agrees Selleys’ Darren Newland.
The next months are going to be “very, very challenging” in terms of shipping and cost of materials, he says, and it’s not over yet: “I think we will still have a number of issues to deal with,” he says.
“Everyone is looking at where the economy is going to go and there’s a lot of talk as people are able to travel more freely that the disposable dollar will get sucked up, but we certainly haven’t seen a softening yet.”
So, despite inflation, mortgage and interest rates, says Darren: “Generally in our industry, if it’s a bad market or a good market, people are still doing work around their homes.
“We are very fortunate, I think, in that context that the industry or our part of it is pretty resilient.”
glues, silicones & sealants
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