War in Ukraine Creates Industry Uncertainty

Since Russia’s invasion on Ukraine last week, many glazing industry companies are wondering what the future looks like as global supply chains expect continued contraction. Several companies with offices in the impacted region are closely monitoring the situation, while others have closed their facilities.

According to Ken Simonson, chief economist for the Associated General Contractors of America (AGC), the “war in Ukraine and the West’s response are likely to have multiple effects on construction materials costs and availability.” The most immediate impact will most likely be on diesel fuel and gasoline prices, he continues.

He also referenced a report from the Wall Street Journal this week that states “Russia is an important producer of copper and aluminum,” and “any difficulties getting those commodities to customers worldwide would cause fresh disruptions to strained supply chains.” Cargo ships in the war-torn region have been halted or delayed, Simonson adds.

Saint-Gobain, headquartered in France, has offices and facilities located across Europe, including in Russia and the Commonwealth of Independent States.

“We are monitoring the situation closely with our team’s safety as [the] number one priority. Saint-Gobain has no manufacturing operations in Ukraine, only a sales office in Kiev, with a team of 46 people,” says Susanne Trabitzsch, press relations for Saint-Gobain, France. “Our activities in Russia (insulation, gypsum, construction chemicals) are local: we produce for the domestic market. We do not disclose our sales figures on a country basis, but Russia represents a very small part of our business (less than 1% of our global sales).”

Officials at Glaston Corp., which has offices in Moscow, say that it is still too early to predict the war’s effects on the business and the industry as a whole.

“What is happening has naturally shocked us at Glaston, as it has done with people around the world. As the situation evolves rapidly and we get new information daily, it is too early to predict any effects nor validate impacts,” says Pia Posio, vice president of communications and marketing.

Guardian Industries, the global glass producer with several facilities in Europe—including Russia, is also carefully considering the situation.

“Guardian Industries continues to closely monitor the tumultuous events in Eastern Europe, supporting our employees who are affected. The health and safety of our employees and all personnel working at our facilities is our first priority,” says Alexandra Birladianu, head of corporate communication at Guardian Industries.

Ireland-based CRH also had business operations in Russia, which CEO Albert Manifold told Reuters on Thursday have ceased operations. He also told the outlet that CRH has temporarily closed its Ukrainian operations and supports its 820 employees in any way possible.

The U.S. has sanctions in place against Russia, and energy and metal supplies are expected to be severely disrupted, according to Reuters. The outlet reports that oil prices are set to post their strongest weekly gain since the middle of 2020, and aluminum hit a record high of $3,850 a ton, up nearly 13% and heading for its largest weekly gain ever.

Reuters also reported that Russia will continue to deliver uninterrupted natural gas supplies to world markets and that, although European Union (EU) or U.S. sanctions on Russian gas imports are unlikely, damage to pipelines or Russia stopping gas transit through Ukraine could happen, analysts said. “Fully replacing Russian gas to the EU would not be achievable in the short term,” the Reuters report reads.

USGlass and USGNN™ continue to monitor the conflict in Ukraine closely. Stay tuned for updates as the story is constantly progressing.

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25 Responses to War in Ukraine Creates Industry Uncertainty

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