Construction companies face mounting supply chain disruption amid rising geopolitical tensions, with UK firms particularly exposed due to material import dependencies and labour shortages.

Industry analysis from QBE and Control Risks, published today, highlights how recent international tariffs on construction inputs are already driving up costs and delaying projects. Steel and aluminium are among the worst affected, with US duties on Canadian metals pushing prices to multi-year highs.

Timber costs are also climbing due to US-Canada disputes, compounding risks for UK contractors that rely on American imports. Copper prices have risen by 29% in early 2025 alone, fuelled by tariffs and sustained demand from the EV and renewables sectors.

The UK construction sector is especially vulnerable, given its reliance on imported timber and aluminium, combined with net-zero carbon commitments and a continuing shortage of skilled labour – an issue exacerbated by an ageing workforce.

Neil Fleming, UK construction and engineering portfolio manager at QBE, commented: “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.”

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