Construction input prices increased 0.6 percent in November compared to the previous month, according to an Associated Builders and Contractors (ABC) analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data. Nonresidential construction input prices also increased 0.6 percent for the month.
Overall construction input prices are 3.4 percent higher than one year ago, while nonresidential construction input prices are 3.8 percent higher. Prices increased in two of the three energy categories last month. Natural gas and unprocessed energy materials prices were up 10.8 percent and 1.4 percent, respectively, while crude petroleum prices were down 1.1 percent in November.
Iron and steel were down 2.2 percent in November and up 3.1 percent year over year. Other materials include construction machinery and equipment (unchanged in November and up 4.7 percent y/y), copper wire and cable (down 0.4 percent in September and up 11.7 percent y/y), fabricated structural metal products (up 0.8 percent in September and 8.8 y/y), hot rolled steel bars, plates, and structural shapes (up 2.2 percent in September and 7.9 percent y/y), insulation materials (up 0.2 percent in September and down 0.4 percent y/y), and steel mill products (down 3.2 percent in September and 4.6 percent y/y).
“Construction input prices surged in November and are now up 3.4 percent on a year-over-year basis,” said ABC chief economist Anirban Basu. “While that’s a relatively modest annual increase, it’s also the largest since January 2023, and the trend offers plenty of cause for concern. Many tariff-affected materials, like derivative metal products and switchgear equipment, have experienced considerable price escalation in 2025. Prices for aluminum mill shapes and primary and secondary nonferrous metals are both up more than 25 percent over the past year.
“Unfortunately, it is impossible to know exactly how the cost of tariffs will be distributed throughout the supply chain, and that makes it exceptionally difficult to know how construction input prices will behave in 2026,” said Basu. “Despite this uncertainty, contractors are on net optimistic that their profit margins will expand during the first half of the year, according to ABC’s Construction Confidence Index, albeit slightly less optimistic than they were at the same time last year.”
