Alex Wright is national business development director at Tarmac
With the onset of global trade wars, our world is becoming more transactional in search of a deal. Yet, whatever sector you work in, business always works better and delivers more value for everyone when it prioritises long-term customer and supply chain partnerships over short-termism.
“Cement is increasingly being imported from plants that are not decarbonising in the same way as the UK”
The UK infrastructure sector has in the past decade made great progress to integrate supply chains, encourage collaboration and eradicate transactional relationships.
Right now there are some very good examples of the type of collaboration that brings together owners, partners, advisers and material suppliers, working in a more integrated and collaborative way. It is an approach often underpinned by a greater understanding of an infrastructure programme’s shared vision and desired outcomes.
Early engagement with material providers has equipped some clients and their professional teams with a better understanding of supply chains. These progressive clients are typically focused on sourcing strategies that incentivise the lowest-carbon solutions, prioritise multi-model logistics and drive social value opportunities.
However, this is not always universal. There is still a danger that even those managing the biggest projects can see essential materials like aggregates, asphalt and concrete as a commodity tap that can be turned on and off at speed.
With limited funds in the public purse, the government is under pressure to lower the cost of delivering UK infrastructure. The drive to unlock efficiencies must not herald a return to a race to the bottom in pursuit of a deal.
It’s a fact that construction requires global supply chains, but the priority should always be to use, where possible, homegrown materials with the lowest embodied carbon, and retain economic value in the UK.
There are parts of the infrastructure and construction markets where low-cost, high-carbon imports are entering the market to cut costs. Take cement, the main ingredient in concrete: it is increasingly being imported from countries outside of the EU, and some of these imports are produced in plants that are not decarbonising in the same way as the UK. The carbon emissions associated with their production are being offshored, and the opportunity to boost jobs in the UK minerals sector is lost.
Benefits both ways
Megaprojects – particularly those across the energy transition like nuclear and offshore wind, as well as the water markets – will require significant volumes of material over the next decade. Meeting the needs of these programmes, particularly in regions of the country where multiple projects are competing for resources – both people and materials – will require greater levels of collaboration from clients across the supply chain.
In return, these projects should be able to benefit from new solutions and value-added products – materials that are low-carbon, highly durable and technically right for a world transitioning to net zero.
It will be more critical that clients are supported by partners that can put in place a low-carbon, multi-model logistics offer. This is also about creating the industrial ecosystem of railheads, new low-carbon asphalt and concrete plants required for a project delivering the most sustainable construction. Industry partners cannot plan, invest and create these assets alone without early engagement with clients.
Savvy and enlightened clients understand that these solutions are integral to the critical path, and that decarbonisation and social value will only come from early engagement with the supply chain.
While parts of our political world are undoubtedly moving to transactional dealmaking, the UK’s great infrastructure opportunity calls for greater levels of collaboration. Long-term value and improved environmental and social outcomes will not be delivered with a short-term attitude.
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