Through 2021 the Australian construction sector wrestled with surging raw-material costs and supply-chain disruption. From June 2020 onwards, the price of steel, crude oil, copper, iron, aluminium, coal, chemical materials, and timber all moved upwards — in some cases sharply. Looking back, the period reshaped how local manufacturers and suppliers thought about resilience and self-sufficiency.
Australia, supplying an estimated 60% of China's imported iron ore, was a net beneficiary of the price moves on the export side, even as trade tensions disrupted other agricultural commodities.
In the civil and construction sector, though, the impact was almost universally negative. Steel is a foundational material — cars, buildings, infrastructure, and everything in between — so when steel pricing surged, the impact rippled across nearly every project.
What changed in the industry to push prices up?
COVID-19 created an unusual demand environment, with construction activity rising sharply across multiple economies at the same time. In Australia, the federal government's Homebuilder Scheme added further pressure to building supplies.
Australia also faced a significant timber shortage during this period, off the back of fire damage and surging demand. Timber prices climbed quickly.
Why local manufacturing mattered
Manufacturers that produced product domestically — particularly those running their own panel and product lines — fared better than businesses purely importing finished goods. Even so, raw material supply remained an exposure for almost every supplier.
Local manufacturers reported steel mills running at well below capacity, with finance constraints leaving many mills only able to produce what they could self-fund. Shipping costs through the same period jumped by over 200%, and port-side delays added further lead time as testing protocols slowed crew rotations.
The lesson for buyers
Buyers who took the time to understand their supplier's manufacturing footprint, raw-material sourcing, and inventory position were in a far better position than those who didn't. Even today, those questions matter when sourcing temporary fencing or any other key piece of site equipment.
Site Direct works with manufacturers that prioritise stock availability and product quality, so customers can buy with confidence even when conditions are choppy. The events of 2020-2021 are a reminder that supply-chain due diligence is worth doing — and that long-term supplier relationships pay off when conditions tighten.
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