b'Construction Materials Costs Riseincreases that we have seen in the past 36 months, said for Third Month on Tariff PressuresOReilly. We are advising clients to consider additional, separate contingencies depending on the stage of the project Contractors are receiving price hike notices on several keyand the potential exposure to risk. inputs, complicating efforts to plan and budget new pro-jects.The monthly increases mark the first time since September 2023 that input prices jumped for three consecutive months, said Simonson. Construction input prices have now in-Dive Brief:creased at a 9.7% annualized rate through the first quarter of Construction input prices increased 0.5% in March,2025, said Basu.while nonresidential input prices climbed 0.6%, both unusually steep jumps, according to an analysis byWhile contractors remain busy for the time being, accord-Associated Builders and Contractors of U.S. Bureauing to ABCs Construction Backlog Indicator, this pace of of Labor Statistics data.input price escalation, coupled with rising uncertainty, will Both overall and nonresidential input prices are nowcause projects to be delayed and canceled if it persists for 0.8% higher than a year ago and sit more than 40% high- any meaningful length of time, Basu said. er compared to February 2020, largely due to a sharp rise in natural gas, steel, copper and lumber prices. The price escalations across the board reflect early impacts from tariffs and mark the third straight month of price jumps, said Anirban Basu, ABC chief economist. Dive Insight: Construction input prices increased at a rapid pace for the third consecutive month in March and have now ris-en at a 9.7% annualized rate through the first quarter of 2025, said Basu. The emerging effects of tariffs are glaring in the March data release. Pressure is mounting for owners and builders heading into the second quarter, especially as tariff-related uncer-tainty clouds purchasing and pricing decisions, accord-ing to the Associated General Contractors of America.AGC urged the Trump administration in its release to recon-sider new tariffs, at least until there was greater market cer-Suppliers hit contractors with a wave of price hike notic- tainty about the impacts of those that have already been put es in March, even before new tariffs took effect, accord- in place. ing to AGC. That volatility is making it harder to plan and budget for both public and private sector projects,Our members are trying to deliver the best value for the said Ken Simonson, AGC chief economist.public and private sector clients they serve, said AGC CEO Jeffrey Shoaf. But it is hard to deliver that best value when Lumber and metals prices shot up in March, while con- you have no idea how much you are going to have to pay for tractors inboxes are bulging with Dear valued custom- many of the materials required to build projects. er letters announcing further increases for many prod- Sebastian Obando - Reporter ucts, said Simonson. Rapid-fire changes in tariffs threaten to drive prices higher for many essential con-struction goods. Contractors have been accelerating procurement to lock in prices early, said Michael OReilly, vice president at Rider Levett Bucknall, a New York City-based construc-tion consultancy firm. He said general contractors are largely trying to be proactive and have procurement dis-cussions early on projects, where possible.The latest PPI data indicates one of the largest monthly 8'