Growing risk to material supplies

August 3, 2014 7:59 am

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A new report by EEF, the manufacturers’ organisation, warns the Government to act over escalating risks to the UK’s supply of essential materials.

It says that the global growth in middle-class consumers, increased demand for all commodities and an over-reliance on China for strategic supplies, is leaving the UK vulnerable. But, while other manufacturing nations have strategies in place to shield their economies from resource risks, the UK is lagging behind.

The report – Materials for Manufacturing: Safeguarding Supply – digs behind concerns raised by UK manufacturers that volatile material prices and security of supply pose a threat to growth and confirms that the UK does indeed face escalating risks.

Globally, the consuming middle classes are expected to swell from 1.8 billion people to 4.9 billion by 2030. Demand for all commodities is expected to rocket to 80% by 2030. China is the leading supplier of materials to the UK, producing 22 of 38 elements of strategic economic value. These are minerals and metals that are vital to British manufacturing.

In 2010 the EU deemed 14 materials to have supply risks. This has now increased to 20 materials and includes those used in consumer electronics and telecoms products, engineering/construction, agriculture, aerospace and steel and aluminium production, to name just a few of their end-use markets in Europe.

EEF is now urging the Government to move to mitigate material supply risks by:

  • Establishing an Office of Resource Management to strategically co-ordinate action across Whitehall
  • Thoroughly and regularly assessing material supply risks and vulnerabilities
  • Providing stronger incentives for resource efficiency to help overcome market failures
  • Regulating waste so that we extract more economic value from what we discard.

Susanne Baker, Senior Policy Advisor at EEF, says: “As we approach the end of an economic era we cannot afford to be left underprepared and overexposed. Manufacturers have sounded the alarm over the growing risks to material supply and others are now picking up the clarion call. But while competitor nations are already taking evasive action, our Government is in danger of burying its head in the sand.”

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