CRCA Members Bulletin: Rising Cost of Roofing Materials and Supply Shortages
It is no secret that the roofing industry, and more widely the construction industry, is being severely affected by materials shortages and increased costs. There are several reasons for this:
- pandemic restrictions across Canada resulted in suppliers offloading supply to the comparatively “open” American market;
- safety protocols at mills and factories reduced productivity thereby reducing the supply of materials produced;
- the port of Montreal had significant labour issues resulting in a backlog of outbound supply;
- weather events in the USA also affected material distribution in the last year.
- a pine beetle infestation in Alberta and British Columbia has not been resolved, contributing to shrinking supply, and;
- a mass exodus to the suburbs from downtown cores across the country for new homes has created unprecedented demand for the materials for both new builds and for the renovation of existing homes.
Communication is Key
The reasons for the supply shortage and corresponding price increases are largely not issues that will resolved quickly – market forces are in play that will keep this situation our reality for the near and medium term. Therefore, keeping open communication lines with the affected parties is extremely important. It would be wise for our members, in conjunction with legal counsel, seek ways of avoiding unnecessary litigation with those you are working with. This includes amending existing contracts, beefing up the delay provisions in contracts moving forward, and most of all, keeping an open mind when communicating with your subcontractors, general contractors, suppliers and owners as to what sort of solution you can come up with.
Further on this point, we suggest adding the following provisions to any contract moving forward:
- a price acceleration clause: this provision allows for price increases without change orders. If lumber or other materials increase above a certain threshold, the contract is automatically amended to reflect the change
- a material availability provision: this provision stipulates that the contractor makes no guarantee that materials will be available as stated in contract
- a substitution of material provision: if the materials provided for in the contract are not available, reasonable substitutions can be made at the discretion of the parties involved. These provisions can be worded many different ways and are easily adaptable.
CRCA continues to work with our legal counsel; Cotney Construction Law, to bring solutions to this issue to our members. If you missed the April 29 webinar from Cotney on this topic, please reach out to us for more information or visit the CRCA Cotney Legal Library. Our next bulletin will deal with the issues faced by our members with existing contracts.