Soaring material prices promise hefty work bills

The French who will call on building craftsmen in the coming weeks should expect to take their troubles patiently... and to pay a high price for their services.

“Consequences of a combination of several factors: health crisis, shutdown of certain industries, the price of materials is rising sharply and supply times are getting longer” warns the Confederation of Crafts and Small Building Companies (Capeb) in a press release published on Tuesday April 27, warning of a “critical situation” which should weigh on certain categories of work undertaken by households.

MaPrimeRénov': more balance to be paid

La Capeb warns that those eligible for MaPrimeRénov ', the public aid for energy renovation launched last year, should thus ask individuals for a larger remainder to be paid, insofar as the calculation of this premium is often established in part based on the cost per square meter of the work.

But this inflation will be far from being confined to these works alone. The overwhelming majority of interventions in the building should suffer, including in new construction.

Outbreak in Chicago

“A strong increase” is practically an understatement: observed for several months, the inflation in the prices of building materials – and raw materials in general – continues at a frantic pace.

From nails to wooden planks to zinc, no product escapes it. Prices are soaring on the Chicago Stock Exchange, the world's largest commodity market. Copper, iron ore and aluminum are trading at their highest level in almost ten years, while steel is trading at an all-time high.

20% to 80% increase among French traders

Lumber prices, in particular – stable for years – have literally exploded in the space of a few months. Between production delays caused by the health crisis and a sharp return in demand, in particular that of the United States, which has turned to European stocks since Donald Trump overtaxed Canadian wood, French building trades are seeing spectacular price increases for their producers.

Depending on the product category, the increases since September 2020 vary from 20%... to 80% for finger-jointed solid wood, as reported by L'Est Républicain in a report devoted to the company Bois & Dérivés, one of the main traders in the former Franche-Comté region.

American frenzy

Not to mention that this trend should be further accentuated in the coming weeks: after a year 2020 marked by several natural disasters (fires, hurricanes, etc.) and with an insolent post-covid recovery, American demand for lumber is such that its futures contracts even observe a bubble phenomenon: these "futures" yesterday crossed the $1,400 bar, up $400 since the beginning of the month, and even though they were trading for less than 300 $ a year ago.

Although a correction cannot be ruled out, it still seems obvious that American traders should continue to pay a high price to Europeans to satisfy their domestic demand. The phenomenon should de facto maintain this inflation and cause a risk of shortage, worry the professionals of the sector.

Finally, for craftsmen and private individuals, these price variations are all the more problematic the faster they are, because they induce differences in the evaluation of the cost of a service between the time when its estimate is drawn up and the time when the works are finished. With the key, inextricable potential conflicts for interventions carried out "at a loss" on the craftsmen's side or construction sites that have become "out of budget" on the private side... The latter will have every interest in examining their general conditions of sale twice before committing themselves. engage in projects whose costs are likely to balloon in the space of a few weeks.