Materials for Manufacturing: Safeguarding supply

8th July 2014

Materials for Manufacturing: Safeguarding supply

How we obtain, use and reuse the materials that flow and circulate within the economy matters to manufacturing. Materials and resources are the lifeblood of the sector and account for around 40% of manufacturers' costs.

Highly volatile costs, supply risks associated with a small but growing number of commodities and the UK’s high dependency on imports have heightened concern within the manufacturing community in recent years. UK manufacturers have consistently highlighted that high material prices and security of supply is a threat to growth. Rising commodity prices increase manufacturers’ input costs, in turn reducing discretionary spending by households.

But volatility is equally as damaging as it can dampen economic growth by increasing uncertainty which may discourage or delay businesses investment and increase the cost of hedging against resource related risk.

In this report, the Manufacturers Organisation sets out the medium to long-term trends which are underlining this concern; exploring how other nations are responding and how this can inform our own strategic approach. The research shows that manufacturing competitors are investing in significant industrial strategies to improve their resilience to security of supply risks.

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