Construction Input Prices Rise 11.2% Over Year
Monthly and annual increases in construction input costs were driven largely by higher fuel prices tied to the conflict in Iran, according to an ABC analysis of federal data.
Updated on Nov. 2, 2026 in Construction
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Construction input prices rose 2.2% in September 2026 compared to August 2026, and rose 11.2% between September 2025 and September 2026, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics Producer Price Index data. The annual increase is the largest in nearly four years.
Why it matters
Higher fuel prices tied to the conflict in Iran account for a substantial portion of the increase, while tariffed materials such as iron, copper and other metal products continue to rise rapidly. These cost pressures are squeezing contractor margins across the U.S. construction sector.
Construction input prices rose 11.2% year over year, the largest annual increase in nearly four years, with crude petroleum up 28.3% and unprocessed energy materials up 22.2% over the same period. Natural gas prices rose 5.1% in September alone, and the extraction does not indicate how these trends will evolve in coming months.
The players
Associated Builders and Contractors (ABC)
A national trade association representing construction contractors and related firms in the United States, which publishes the Construction Confidence Index and analyzed the federal price data.
U.S. Bureau of Labor Statistics
The federal agency that compiles the Producer Price Index used to measure changes in construction input costs across the economy.
The details
Higher fuel prices driven by the conflict in Iran accounted for a substantial share of the increase. Prices for tariffed materials such as iron, copper and other metal products also continued to climb rapidly.
Timeline
September 2025: Baseline month for the year-over-year price comparison.
September 2026: Construction input prices rose 2.2% monthly and 11.2% annually.
November 2, 2026: Bureau of Labor Statistics Producer Price Index data released and analyzed by ABC.
Market Landscape
The 11.2% year-over-year rise in construction input prices is the largest in nearly four years, measured by the Bureau of Labor Statistics Producer Price Index. Rising tariffs on iron, copper and other metals and higher fuel costs tied to the conflict in Iran are pushing contractors' input costs higher across the sector.
Contractors facing higher material and fuel costs may pass those increases through to project prices, affecting what homeowners and businesses pay for construction work. More than 1 in 4 ABC contractors expect their profit margins to contract over the next six months.
The takeaway
Construction cost increases are unlikely to ease quickly while energy prices and metal tariffs remain elevated. Readers planning building projects should expect pricing volatility and budget with some margin for further increases.
Further reading
For more on the sector, see the Construction section.
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