March 2021 Newsletter

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Dear Friends,

There has been a lot of good news since my February letter. First, Congress passed another Covid-19 relief bill, this one for $1.9 trillion. This will “juice” the economy and most economists have adjusted their GDP estimates for 2021 upwards as high as 6.9%, the highest in many years. Congress is also edging closer to an infrastructure bill, which if passed, will further stimulate the construction economy. Winter is over and drier, warmer weather is now upon us. All these things add up to a very positive outlook for construction.

The only dampening effect is all the prices increases we’ve been seeing. Read on to learn more about announced increases for the main products we sell.

Most manufacturers of construction products pushed through some form of price increase in March if not already done so in February. Construction commodity goods were not immune either and also saw numerous price adjustments.

Rebar once again saw an increase in early March. All three major mills in the Southeast announced a $40 per ton increase on March 9th and March 10th. Raw material shortages and scrap metal again posting up $50 per ton in March were given as the reasons for the increase. As demand for rebar remains high moving into Spring and Summer, expectations are for this price increase to stick. The most recent increase continues the uncertainty in the market and has buyers once again scrambling to make purchases to cover current and future work.

Wire mesh reinforcing also saw increases in March. An initial price increase was pushed out in early March by all major mills and was thought to be the only expected one to occur for the month. Roughly three weeks later another price increase was announced by one major mill with the others holding tight. The remaining mills are not expected to hold current pricing for long and we expect the remaining mills to follow in the coming weeks. Scrap pricing and a nation-wide shortage of wire rod used to manufacture reinforcing mesh are causing the volatility and climbing prices.

Lumber may be the one commodity that has not seen as much volatility in March. While pricing remains high (and slightly climbing), the large day-to-day increases have not occurred as frequently. Domestic production is still struggling to keep up with demand, but an influx of import material has helped to subsidize some of the high demand. As demand remains high, the expectation for lumber prices in the short term is to for them to continue to increase. The outlook for pricing looks more like a gradual incline rather than the hockey stick style increase we saw in the fall of 2020 and earlier this year.

The product seeing the most impact in March was polyethylene sheeting. The recent winter storms in Texas completely upended the resin and poly production in that region. Not only was manufacturing time lost due to the storm, but equipment and some facilities experienced major damage. These damages and production delays have caused multiple poly manufacturers and resin manufacturers to declare force majeure on many of their products. Poly sheeting pricing has seen increases of almost 20% in just the past month with more expected to follow. We expect poly sheeting pricing and supply to be a major issue for the remainder of 2021.

Below are more construction material manufacturers that have announced price increases.

OCM Inc. has announced a price increase effective March 15th, 2021. This ranged from 7% to 10% on all steel products. Global supply chain issues on both raw materials and finished goods are mentioned as the need for the price increase.

Prime Resins has announced that they will be implementing a product “surcharge” as a temporary measure to combat rapid price increases on raw materials. They anticipate the temporary surcharge to last roughly 4 to 6 months and should reduce over that time period.

Tremco Inc. has also moved forward with a temporary surcharge on all products excluding their silicones, ERP, and PUMA products. Tremco expects the 7.5% surcharge to be effective for 90 days, but all depends on market conditions.

Pecora Corporation implemented their temporary surcharge of 6.5% on all latex, epoxy, polyurethane, hybrid, and butyl products. Silicone sealants are currently exempt from this surcharge. The lack of raw materials in the supply chain is listed as the driving force behind the surcharge.

SpecChem announced a price increase on March 10th. Immediate price increases on epoxy and polyurea products (10% increase), cure and seal solvent products (10% increase), and freight surcharges are all now in effect. The increases in freight costs and limited raw goods are the causes for the increase.

Quad-Lock has announced a minimum 7% increase on all Quad-Lock and Quad-Deck products effective April 15th. All current orders must be shipped by this date or are subject to repricing.

Nomaco also released a price increase set for April 15th. All orders placed before April 15th for immediate shipment will have old pricing honored. Any order placed after April 15th will see a 7% increase on the Nomaflex, SOFRod, HBR, HBR XL, SOF Seal, SOF Seal Plus, and Fastflex products.

DuPont (formerly Dow Chemical) announced an 8% increase on extruded polystyrene (Styrofoam) and a 5% increase on ISO that will begin on April 15th. All orders placed before April 2nd, with a ship date prior to April 15th will invoice at old pricing. DuPont also announced a 12-15% increase on their Spray Polyurethane products beginning April 12th. All orders shipping on or after this date will be subject to the price increase.

Prosoco announced a price increase effective April 1st. Products impacted by this price increase include Clean & Protect Products (7.5% increase), Concrete Flooring Products (7.5% increase), and Building Envelope Products (4.5% increase). All orders must be placed before April 1st and ship prior to April 15th to be invoiced at old pricing.

One year after the pandemic struck, construction firms are experiencing soaring materials costs, widespread supply-chain problems, and continuing project deferrals and cancellations, according to a survey AGC released on March 11. The producer price index (PPI) for nonresidential building construction—a measure of the price that contractors say they would charge to build a fixed set of buildings—increased 0.3% from January, while the PPI for inputs to new nonresidential construction jumped 1.9%, the Bureau of Labor Statistics (BLS) reported on March 12. AGC posted tables and charts showing PPIs relevant to construction. Since hitting a low in April, the nonresidential building “bid price” PPI has edged up only 0.5%, while PPIs for new-construction inputs have soared 12.8% for nonresidential and 13.9% for residential.
Click here for the latest update on the construction economy from Ken Simonson, the chief economist of the AGC.

Catching up with our Customers

In this month’s segment of “Catching up with our Customers”, we catch up with Garett Harvey, president of CBM Concrete. Garett first began his journey in the concrete industry right after college, working at Savannah Hardscapes where he found his appreciation for concrete work. Garett then moved on to create Outdoor Accents, a company that had concrete, masonry, and decorative concrete services.

After several years, Outdoor Accents began focusing strictly on concrete projects which led to the creation of CBM Concrete and brought the company to where it is today. Learn more about Garett’s favorite jobs, his regard for “large/small” businesses, and the special meaning behind the CBM name by reading the full Q&A on our website.

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Associate Profile

Sam Shaw
Warehouse Rebar Fabricator Associate, Greenville

This month's associate profile is of Sam Shaw, a Warehouse/Rebar Fabricator Associate in our Greenville branch. Sam was born in Greenville and is a graduate of Riverside High School and received his Associates Degree in Business from Greenville Technical College. Prior to joining us this past January Sam was self-employed in the drone photography business. Sam’s hobbies include “spirited motorcycle riding”, spending time with his girlfriend and her son, and going on social outings with friends. Sam has made an immediate impact on the Greenville team with his work ethic and “can do” attitude.

Our Leadership story this month is titled, Six Practices That Will Make You a Better Listener. Many supervisors are better talkers than listeners (including yours truly), so I learned some good tips from this article. If you’re trying to be a better listener, give this a read.

6 Practices That Will Make You a Better Listener

By Ken Blanchard

As we begin to come out of the coronavirus pandemic and run smack into the turmoil around continuing racism in our country, I think it’s a good time to review an essential leadership skill: listening.

So often the key to overcoming a difficulty—whether it’s in the workplace or at home—is to stop talking and start listening. I often like to joke that if God had wanted us to talk more than listen, he would have given us two mouths.

Yet few people have mastered the art of listening. Why is this seemingly simple skill so difficult?

Research published by Wendell Johnson in the Harvard Business Review examined one way the listening process goes wrong. Johnson found that because of how our brains work, we think much faster than people talk. As we listen to someone talk, we have time to think of things other than what the person is saying. As a result, we end up listening to a few thoughts of our own in addition to the words we’re hearing spoken. Usually we can get back to what the person is saying, but sometimes we listen to our own thoughts too long and miss part of the other person’s message.

To sharpen your listening skills, learn to apply the following six practices.

  1. Resist the Temptation to Jump In. Sometimes people need time to formulate their thoughts. Particularly if you’re an extrovert, control the impulse to finish people’s sentences or fill silences with your own opinions and ideas.
  2. Pay Attention to Body Language. Listen with your eyes as well as your ears. Watch a person’s face and body movements. Are they avoiding eye contact? What about the tone of their voice—do you hear confidence, eagerness, or perhaps irritation? Be aware of clues that their silent behaviors provide, while being sensitive to your own nonverbal signals. For example, is your body language encouraging someone to continue with a conversation, or silently telling them to stop?
  3. Ask Questions. This is not about interrogation or control. Use well thought-out questions to seek information, opinions, or ideas that will help you understand exactly what is being said. Use open-ended questions to encourage communication; for example, “Can you tell me more about that?” Ask clarifying questions to check for understanding; for example, “When did this happen?” Ask prompting questions to encourage deeper thinking; for example, “What do you think caused this to happen?”
  4. Reflect FeelingsAcknowledge any emotions the person is expressing and show them you understand by restating their feelings back to them in a nonjudgmental way. This demonstrates that you not only understand their message but also empathize with their feelings.
  5. Paraphrase. Again, resist the temptation to respond with your own thoughts. Instead, restate in your own words what the person said. This demonstrates that you heard what they said and assures that you heard them correctly.
  6. Summarize. State in a nutshell what was communicated during the entire conversation. Don’t worry about repeating the exact words. What’s important is to capture the main points and general sequence of what was said. This is where you want to reflect the speaker’s conclusion back to them to indicate that you understand.

These practices are not easy—they require time and effort to master. But once you do master them, you’ll build more satisfying relationships. You’ll also avoid a lot of the errors, frustrations, and inefficiencies that come from unclear communication. Think of how our homes, workplaces, nation, and world could change for the better if we all learned to listen to one another.

That’s all for this month. Spring is here and the economy is about to boom, so buckle your chin strap and get ready for a strong building season.

Best regards,

Jim Sobeck
President & CEO 864-263-4377 (Direct Line)
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Author of The Real Business 101: Lessons From the Trenches
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