Report, developed in partnership with Control Risks, found that recent tariffs on key construction materials are already inflating input costs and delaying projects.
Construction companies must adopt a proactive and strategic approach to managing geopolitical volatility, embedding risk awareness at the highest levels of decision-making if they are to avoid potential supply chain disruptions, a report from business insurer QBE has advised.
According to Trade tensions and the construction sector: Navigating supply chain disruption, developed in partnership with Control Risks, recent tariffs on key construction materials such as steel, aluminium, timber and copper are already inflating input costs and delaying projects in North America and Europe.
Key findings include:
- Steel and aluminium are among the most exposed materials, with US tariffs on Canadian imports already pushing prices to multi-year highs.
- Timber costs are surging due to US-Canada disputes, impacting UK contractors who rely on American imports.
- Copper prices have spiked 29% in early 2025, driven by tariffs and sustained demand from electric vehicle and renewable energy sectors.
UK construction firms are particularly vulnerable due to their reliance on imported aluminium and timber.
This situation is compounded for British building contractors and property developers due to the UK’s commitment to net-zero carbon emissions by 2050 and pressure to build with more environmentally sustainable materials.
In addition, the sector continues to grapple with a shortage of skilled labour, an imbalance uniquely impaired by reduced immigration to the UK post-Brexit, alongside an ageing workforce.
For construction businesses, the report notes that the priority is to strike a strategic balance: building resilience and adaptability while managing the higher costs and operational demands of an increasingly fragmented global landscape.
Neil Fleming, UK Construction & Engineering Portfolio Manager for 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. Proactively engaging with insurers and leveraging specialist solutions will help construction firms manage project continuity and financial stability in the face of some uncertainty this year, and into next.”