Contractors brace for more pain as material prices climb

A brand new report from insurer QBE, in partnership with world danger consultancy Management Dangers, warns that current worldwide tariffs on key supplies like metal, aluminium and timber are already pushing up prices and impacting jobs.

UK companies are notably uncovered as a result of their heavy reliance on imported aluminium and American timber — each now costlier as a result of escalating commerce rows.

The report additionally highlights copper costs surging 29% in early 2025, fuelled by commerce limitations and world demand from renewable power and electrical car initiatives.

Strain is constructing from all sides. Labour shortages, net-zero targets and materials inflation are all converging to squeeze contractors additional, with mission dangers rising sharply within the second half of the yr.

The report comes as Building merchandise manufacturing returned to development within the second quarter of 2025, in line with the Building Merchandise Affiliation’s newest State of Commerce Survey.

Suppliers at the moment are extra assured of an increase in gross sales over the subsequent 12 months however flagged up long-standing worth pressures within the provide chain and enhance in wages and salaries in comparison with a yr earlier. This follows April’s rise within the Nationwide Dwelling Wage – spurring will increase in subsequent pay grades – and the rise in Nationwide Insurance coverage Contributions.

Neil Fleming, UK development and engineering portfolio supervisor at QBE, stated: “The confluence of world provide chain disruptions, rising materials prices, labour shortages and sustainability targets presents a fancy danger panorama for the UK development sector.”

The report stresses that contractors should take a extra strategic strategy to sourcing, logistics and danger administration in the event that they need to keep mission supply and monetary stability.