Quantifying the impact of tariffs on construction material imports

The effective tariff rate on US construction imports have surged to 27.7%, up from 19.2% in May and 0.9% prior to President Trump’s return to the White House. The fast-changing trade policy environment is a key risk for US construction costs.

• The effective tariff rate could jump to 36% if reciprocal tariffs from ‘Liberation Day’ are imposed, and a breakdown in US-China trade negotiations brings the return of 145% tariffs on China. Glass, plastics, and electronic components face the biggest tariff increase under this scenario.

• Targeted tariffs on key construction inputs including steel, aluminium, and copper are disproportionately affecting the construction industry, which faces an additional effective tariff of 10% compared to the broader economy.

Chart 1: Construction material import prices are disproportionately affected by US trade policy