19 April 2022 | Collaboration | BY: Road Surface Treatments Association Ltd

RSTA working to address hyperinflation challenges

RSTA member companies have reported a positive dialogue with their clients over the issue of hyperinflation and the effect it is having on bitumen and oil prices.

They have been reporting their experiences in the surface treatment sector over the last three-four weeks, which have resulted in positive discussions with their clients.

Most are being receptive to the need to increase previously contracted rates, said the Road Surface Treatments Association (RSTA). Clients should look to ensure they complete their preventative surface treatments programmes as far as possible to ensure they retain the resilience in their networks until prices stabilise, unlikely at least until the end of the year, the RSTA also advises.

Many clients and contractors have moved to an interim approach of monthly indexations at the point of works taking place-the indexation only known later prior to invoice-usually based on BCIS index.

Paul Boss, Chief Executive of the RSTA, said: “Things have changed over the last three-four weeks with some members being more positive about the discussions with their clients. Concerned clients should discuss if the interim approach to monthly indexations is a more effective way forward and may be an option on their contracts. Hyperinflation is continuing to be an issue with no solution on the horizon, so sensible and practical discussions and collaborations need to continue, where possible.”

Member companies have also reported short supply of bitumen is also becoming an issue and is affecting the whole of the road building and maintenance industry.