b'Construction Costs Rise as Tariff Clock Ticks Dive Brief: Construction input prices ticked up 0.2% in June, driven by increases in key materials such as copper and fab-ricated structural metal products, according to an As-sociated Builders and Contractors analysis of U.S. Bureau of Labor Statistics Producer Price Index data. Input costs now sit 2.1% higher overall and 2.5% higher for nonresidential construction compared to a year ago, according to the report. Through the first half of 2025, nonresidential prices climbed at a 6% annualized rate.The June data predates the steepest tariffs set to takeAt the same time, inflation appears once again to be gain-effect Aug. 1, leaving contractors bracing for moreing momentum. Core good prices, excluding automobiles, volatility as additional duties loom.increased at their fastest pace since late 2021 in the June Consumer Price Index report, signaling additional risk for Dive Insight:contractors on the horizon, said Anirban Basu, ABC chief Contractors absorbed another round of steady cost in- economist. creases in June, even before the most aggressive tariffs take hold later this summer, according to the AssociatedNonresidential input price escalation has accelerated in General Contractors of America.2025, said Basu. While it is unclear how and when trade policy will affect construction materials prices, the Aluminum mill shapes climbed 6.3% over the past year,impact was evident in Junes CPI release. steel mill products rose 5.1% and lumber and wood prod-ucts increased 4.8%, according to the report. More ex- Nevertheless, Basu said many contractors remain up-treme increases hit certain structural steel components,beat about their margins. That outlook may reflect federal including a 22.5% spike in fabricated metal for bridgestax changes under the One Big Beautiful Bill Act, which and 8.3% for bar joists and rebar.made 100% bonus depreciation permanent and helped offset some pressure from rising input costs. The fact that construction materials prices are rising even before the steepest proposed tariffs have taken effectEconomic uncertainty remains extraordinarily elevated, doesnt bode well for what will happen in August if thesaid Basu. What is all but certain is that the Federal Re-promised new tariffs are implemented, said Ken Simon- serve will not be cutting interest rates at its July meeting. son, AGC chief economist. Rising construction costs andDespite higher-for-longer interest rates and rising input economic uncertainty are already causing some owners toprices, contractors remain relatively optimistic. put projects on hold, which will only get worse if costs jump again.Still, AGC officials warn confidence may erode if tariff-driven increases persist. If costs spike too sharply, more The Trump administration raised steel and aluminum tar- developers may choose to delay or cancel projects out-iffs to 50% last month and plans to impose a similar 50%right, according to the report. duty on copper on Aug. 1. Broader import re-strictions also still remain under consideration.The construction industry is poised to benefit from great-er tax certainty as well as the administrations efforts to streamline permitting and reduce needless regulatory bur-dens, said AGC CEO Jeffrey Shoaf in the release. Finding a way to provide greater certainty on materials prices is the best way to make sure the new tax and regu-latory approach have the best possible impact on econom-ic activity. By: Sebastian Obando Reporter16'