Dive Brief:
- Construction input prices leapt 1.7% month to month in April and are up 6.2% so far in 2026, according to an analysis of the latest economic data by Associated Builders and Contractors released Wednesday.
- Energy and metals-related materials drove much of the monthly escalation. Crude petroleum prices, for example, jumped 11.3% month to month in April, followed by a 9.2% increase in unprocessed energy materials, according to the ABC analysis.
- Overall, construction input prices sit 7% higher than one year ago, according to ABC, with nonresidential costs up 7.4%. Cost pressures will likely continue to weigh on construction activity over the coming months, said Anirban Basu, ABC chief economist.
Dive Insight:
All three energy subcategories increased in April, putting upward pressure on most construction materials.
“Construction input prices surged again in April,” said Basu in the release. “Input prices have now risen more during the first four months of 2026 than over the prior three years.”
The 6.2% year-to-date increase dwarfs other recent upticks, according to ABC. Over the prior three years, input prices grew about 4.8%.
Though much of that recent rise stems from oil price surges, escalation was also more widespread in April, noted Basu. Tariff-affected materials, such as iron and steel, posted particularly large price increases during the month, Basu said.
Transportation and fuel-related costs accelerated sharply during April, according to a report from the Associated General Contractors of America. Diesel fuel prices jumped 13.6% month to month in April alone and now sit about 73.8% higher than one year ago. Asphalt prices skyrocketed 41% month over month in April, according to AGC.
“Construction input costs continue to rise much faster than contractors’ bid prices, particularly for energy-intensive and metals-related materials,” said Macrina Wilkins, director of market insights for the Associated General Contractors of America. “That gap is making it increasingly difficult for contractors to accurately price projects and raising the risk of delays, redesigns and deferred construction activity if cost volatility persists.”
The latest inflation data also dashes hopes for lower borrowing costs later this year, said Basu.
“In addition to the direct impact of this reemerging materials price escalation, too-hot inflation data coupled with upbeat labor market indicators suggest that the Federal Reserve is unlikely to cut rates this year,” said Basu. “While contractors remain busy … these cost pressures will likely weigh on construction activity over the coming months.”
