Contractors brace for more pain as material prices climb

Aaron Morby 1 day ago
Share

Contractors are being urged to step up planning to avoid getting caught out by fresh global supply chain shocks.

A new report from insurer QBE, in partnership with global risk consultancy Control Risks, warns that recent international tariffs on key materials like steel, aluminium and timber are already pushing up costs and impacting jobs.

UK firms are particularly exposed due to their heavy reliance on imported aluminium and American timber — both now more expensive due to escalating trade rows.

The report also highlights copper prices surging 29% in early 2025, fuelled by trade barriers and global demand from renewable energy and electric vehicle projects.

Pressure is building from all sides. Labour shortages, net-zero targets and material inflation are all converging to squeeze contractors further, with project risks rising sharply in the second half of the year.

The report comes as Construction products manufacturing returned to growth in the second quarter of 2025, according to the Construction Products Association’s latest State of Trade Survey.

Suppliers are now more confident of a rise in sales over the next 12 months but flagged up long-standing price pressures in the supply chain and increase in wages and salaries compared to a year earlier. This follows April’s rise in the National Living Wage – spurring increases in subsequent pay grades – and the rise in National Insurance Contributions.

Neil Fleming, UK construction and engineering portfolio manager at QBE, said: “The confluence of global supply chain disruptions, rising material costs, labour shortages and sustainability goals presents a complex risk landscape for the UK construction sector.”

The report stresses that contractors must take a more strategic approach to sourcing, logistics and risk management if they want to maintain project delivery and financial stability.

Latest news

Green light for £1.7bn Edgware town centre revamp

Ballymore to deliver 3,365 new homes
9 hours ago

Bridge faults plunge Severfield into £18m loss

Firm cuts staff by 6% and raises option to sell part of stake in Indian arm
14 hours ago

BAM UK Construction back in the black after Co-op woes

Nuttall civils arm powers up profits with margin topping 5%
15 hours ago

Mace sells consulting business to Goldman Sachs

Sale gives construction bosses "opportunity to refresh and simplify" operation
1 day ago

Vinci gets green light for £35m St Helens transport hub

New interchange set to anchor wider town centre revamp
15 hours ago

National Highways major projects chief to join Skanska

Dean Sporn to become Operations Director at infrastructure business
23 hours ago

Kori Construction bags care home brace

More wins as later living specialist posts record results
15 hours ago

Building engineering services workers agree three-year pay deal

Plumbers and heating and ventilating engineers to get staged 10% increase
15 hours ago

Contractors brace for more pain as material prices climb

Copper, aluminium and timber prices move after tariff turmoil
1 day ago

Funding deal ignites £1.9bn Birmingham Smithfield rebuild

Lendlease and Crown Estate JV gears up for early 2026 start
2 days ago

Van Elle profits slump as Canadian arm racks up losses

Pre-tax profit nearly halves to £3m as Canada ops review looms
2 days ago

Dalkia Engineering rebounds from £14m loss to post profit

Order book hits £191m after turnaround year at M&E specialist
2 days ago

Thomas Sinden targets £100m turnover

Essex contractor posts strong set of results as profits more than double
2 days ago

Kier lands £139m Severn Trent job as water work ramps up

Major Leicestershire sewage works overhaul starts this summer
2 days ago

Unite hotel builder arranged football flights for ex-union boss

Report into £30m cost overruns hears contractor was guaranteed a 12.5% profit margin
2 days ago

Glencar wins Essex business park deal for Panattoni

Work to start on extension to Braintree site
2 days ago

Henry Brothers to build £25m diagnostic centre

Enabling works to start this month on Nottingham site
2 days ago

Sizewell C go-ahead as funding deal signed at £38bn

Government takes 44.9% stake in huge public investment
3 days ago

Kier chief Andrew Davies to retire in October

Construction MD Stuart Togwell to take over the reins
3 days ago

New Gateway 2 guide in bid to ease bottleneck

Authorities want 'plans off the page and onto site as quickly as possible'
3 days ago

Van Elle takes over Volker piling kit in strategic tie-up

Concrete piling assets switch hands in strategic partnership
3 days ago

Midgard to start £145m Birmingham towers

Funding deal clears way for 581 flats near Centenary Square
3 days ago

SDC gets date for £60m iconic Stirling Building revamp

Work to restore Cambridge University building set for early 2026 start
3 days ago

Network Plus names new COO

Utility and infrastructure firm promotes Dave Prescott
3 days ago

Solid wall insulation scandal kicks off shake-up

Expert panel launched to rebuild trust in retrofit standards
4 days ago

Siemens wins converter station jobs on £2.5bn EGL4 subsea link

HVDC deal marks major step forward for third Scotland-England power route
4 days ago

Guinness opens bidding on £250m remediation framework

Fire and structural remediation jobs up for grabs nationwide
5 days ago

Gloucestershire plans £60m highways major works deal

Bidding to start this Autumn for large highways and structures framework
4 days ago

Wills Bros wins latest £152.7m A9 dualling deal

Contractor beats off competition from Balfour and Graham
6 days ago

True cash cost of HS2 to date tops £40bn

New figures ditch 2019 prices as project switches to full cash terms
5 days ago