Timber bottlenecks lead to construction stoppages in Germany

BERLIN (Reuters) – Bottlenecks in the supply of wood, steel and insulation material are causing construction stoppages in Germany and threaten to delay the country’s recovery after the coronavirus slump, construction associations said Friday.

FILE PHOTO: A general overview of a construction site for a residential building, in Berlin, Germany, April 15, 2021. REUTERS / Michele Tantussi

The German economy, the largest in Europe, contracted more than expected in the first quarter due to COVID-19 restrictions, but optimistic business sentiment surveys are now heralding a rapid summer recovery.

The strength of the recovery will depend on how many consumers will splash out once the curbs are lifted and how many manufacturers will be able to overcome supply bottlenecks.

Highly dependent on timber, roofers are among the construction companies particularly hard hit by the shortages.

In some regions, roofers are facing a tripling in prices and some are even complaining that they cannot get any wood at all, Dirk Bollwerk, head of the German Roofers Association, told Reuters.

“The timber crisis has taken us by surprise,” said Bollwerk.

The supply problems are partly related to the strong economic recovery in many countries, which has driven global demand for timber, steel and other building materials.

“With the economic recovery in the United States and China, international supply chains were turned upside down,” the German Construction Association (ZDB) said in a statement.

Pest control of forests in Europe and Canada, as well as export restrictions by some countries, have also reduced timber supplies and pushed up prices.

Prices for roof battens, a standard building material, have exploded since February, says Bollwerk, head of a medium-sized roofing company in the western state of North Rhine-Westphalia.

Bollwerk added that a growing number of companies were forced to stop construction due to lack of equipment.

The problem also affects other construction companies.

“The bottlenecks could bring construction sites to a halt in the summer,” said Felix Pakleppa, ZDB’s general manager.

German timber exports surged last year and construction company associations earlier this month called on the government to impose trade restrictions to keep more timber for domestic customers.

Economy Minister Peter Altmaier has rejected such a move, saying that export restrictions are incompatible with the government’s position to support open markets and free trade.

Altmaier has instead promised construction companies that the government will cut red tape and also temporarily relax strict rules on contract penalties in case of construction delays.

Reporting by Reinhard Becker; Written by Michael Nienaber; Editing by Frances Kerry

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