A 25% rate over almost all of the goods in Canada and Mexico, implemented by the Trump Administration, on March 4, can lead to a cost climb for construction materials and increase in the general costs of the project, but the ramifications will depend on how fare and countermedia measures occur in a situation that is still evolving.
In addition to the 25% rates imposed against the two neighboring countries, after a delay in the initial announcement of February, the administration also increases the rates placed on the goods of China in China to 20% of an additional 10% collected in February.
The recently announced rates will be stacked with a 25% rate in steel and aluminum imports announced in February and can increase prices. “While the United States manufacture a significant amount of products that enter commercial construction projects, there is an import dependency. Estimates suggest that about one third of the materials used in US building projects are imported,” says Steve Southamer, executive vice president of project planning in the Skanska USA building.
He adds: “Although we hope that the North -American manufacturers will be able to increase production to meet a higher demand, we hope that it will also cost and possibly create challenges that meet the requirements of the meeting calendar.”
Different conditions of the Trump First Administration
Construction entry prices are still 40% higher than before pandemic, according to the Labor Statistics Office, “ leaving little space for producers to absorb even more, ” says Sarah Martin, an associate director of the Dodge Construction Network forecast. “Unlike 2018-19, when inflation was low and rates were more specific to specific imports, rates promulgated today could add more widespread risk to the construction sector.”
“With a blanket rate to all imports of Canada and Mexico, the cost increases will be widespread throughout the supply chain, especially in cement, wood, copper, steel and aluminum,” says Martin. “The final impact on the construction industry will depend on the duration of these rates and retaliation measures that are launched.”
Following the tariff announcement, Canada and China announced retaliation rates in various items from the United States
Mike Ireland, President and CEO of the Portland Cementation Association, responded to the rates in a press release, saying: “The North -American cement industry would like to work with the administration to address federal laws and regulations that prevent North -Americans’ -American cement companies from increasing the United States from 20% of their total cement consumption annually, including Canadian and Canada. Mexico. “
Currently, approximately 27% of the entire United States -imported cement comes from Canada and Mexico, which includes 7% of all cements used in the country. “North -American cement manufacturers, which provide materials for the vast America’s infrastructure … They believe that the proper tax, tax, and permission permission will lead to more investments in US cement production,” said Ireland.
