“Construction input prices surged again in April,” Anirban Basu, chief economist at Associated Builders and Contractors, said in a press release. “Input prices have now risen more during the first four months of 2026 (6.2%) than over the prior three years (4.8%).”

Spikes in energy prices, due to the ongoing conflict in Iran, account for much of the overall increase. Crude petroleum prices soared in April, up 11.3% since March and a whopping 61.8% since April 2025. Unprocessed energy materials jumped 9.2% this month, and 48.9% year-over-year.

Lingering effects from tariffs are also evident. Impacted products such as steel mill products and hot rolled steel bars, plates and structural shapes continue to see rising prices, up 3.8% and 4.1% in April, respectively, on a monthly basis.

“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, in a statement.

“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,” Wilkins added.

Basu expressed a similar sentiment. “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,” he said. “While contractors remain busy, according to ABC’s Construction Backlog Indicator, these cost pressures will likely weigh on construction activity over the coming months.”

Looking for quick answers on construction and engineering topics?
Try Ask ENR, our new smart AI search tool. Ask ENR →