Commodity input prices falling from last year’s highs, says Linesight report

Input prices for construction materials are declining from the highs of last year, according to Linesight. 

In the second quarter of this year, copper prices were down 8.2%, while stainless steel and nickel prices also declined. 

But the Dublin-based construction and property firm predicted that the price of the former metal – a key component in the green transition – would be volatile due to the growth in semi-conductor manufacturing. 

Raw rebar costs dropped 2.4%, but flat rebar rose by 1.5% as producers struggled with meeting the investment levels required to decarbonise. 

High energy costs saw concrete prices shoot up 7.9%, while bricks have stabilised – though they remain 50% higher than in Q1 of 2021. 

Overall, Linesight predicted a modest 3% rise in tender prices this year, with similar increases of 2.75% in the subsequent two years. 

Michael Riordan, the firm’s UK managing director, said: “As commodities moderate, price fluctuations will be driven by demand from high potential growth sectors.  

“Solid implementation plans, supported by government investment, are required to ensure that opportunities are maximized, especially in challenging financial environments. 

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“Project viability will be improved through adoption of strict project controls, with a strong focus on risk and schedule and collaborative procurement strategies.” 

The analyst’s report also looked at sectoral trends, predicting exponential growth in the data centre market and a 4.1% expansion of battery and semiconductor manufacturing projects this year. 

Life sciences was also expected to experience strong growth because of increased venture investment in the UK’s biotech sector. 

A global slow-down in office occupancy has impacted demand for space on the commercial real estate side, with a move toward retrofitting.