Concerns about coronavirus-related supply chain problems themselves did not themselves affect the monthly report’s sub-index measuring supplier deliveries, which actually rose 2.5 points from January to 41.9, adding to a picture for the month of a construction industry that remained in contraction, but with the pace of decline slowing.
However, the reported impact on construction supply chains follows separate a report earlier this week by the Ai Group’s separate Performance of Manufacturing Index, which reported delays in exports of Australian manufactured consumable goods into China, as well as exports from China of equipment, machinery and metals.
For Ai Group, the risks associated with the COVID-19 disease, which has shuttered factories across China and prevented workers from making cross-province journeys to their place of employment after the Lunar New Year holiday season, are another consequence of the increase in imported materials that has already allowed the widespread problem of non-conforming building materials.
A 2013 survey by Ai Group of building-industry suppliers found as many as 92 per cent of respondents reported non-conforming products — those that found their way into the country despite not meeting local quality standards — in their sector.
“This is another legacy of increases in the imported componentry and supply chain going into construction,” Ms Toth said.
“One layer was the problems we’ve had with quality and efficacy. Now we’re seeing disruption to actual supply and quantities rather than just the quality of what comes in.”
Last month, the headline Performance of Construction Index rose 1.4 points to 42.7. A reading below 50 indicates contraction, while a figure above 50 shows growth.
House-building activity rose 1.6 points to 55, apartment construction fell 0.4 points to 35.9 — marking the 23rd straight month of contraction — while commercial construction fell 1.4 points to 37.5. The sub-index for engineering construction rose 2.5 points to 40.5.
