Economic data from the Mineral Products Association (MPA)(2) indicate that demand for core construction materials remains weak, with low sales of concrete, aggregates and mortar in 1Q2026 prolonging a four-year downturn.
MPA commentary cited weaknesses in the housing and commercial markets as constraints on materials demand, compounded by higher borrowing costs and uncertainty.
Dr David Crosthwaite, chief economist at BCIS, said: ‘Taken together with recent movements in materials and producer price indices, the latest bricks and blocks data highlight the prolonged period of weaker demand facing the construction sector. Domestic manufacturers have called for greater support and, while the government has taken steps to ease energy cost pressures, stimulating construction demand is ultimately what the industry needs.
‘The Iran war represents yet another damaging economic shock for UK construction and its supply chains. While the full impact remains uncertain, it increasingly appears that some of the resulting cost increases will become embedded within supply chains, creating further challenges for an industry that has yet to fully recover from previous economic shocks.’
New insight from the latest Builders Merchant Building Index (BMBI) report(3), which analyses market trends using data from the Builders Merchant Panel produced by GfK (Growth from Knowledge), a subsidiary of NielsenIQ (NIQ), further highlighted weakening construction demand through declining sales activity.
After adjusting for trading days, builders merchant like-for-like sales volumes in 1Q2026 were 8.1% lower than in 1Q2025. This reduction in demand affected value sales, which fell by 3.2% year-on-year, despite being partially offset by a 5.4% increase in average prices.
In the 12 months to 1Q2026, the sharpest reduction in volume sales was recorded in the Renewables and Water Saving category, which fell by 13.8%, followed by Heavy Building Materials, where sales volumes decreased by 11.8%.
In contrast, Workwear and Safetywear and Ironmongery were among the three categories to record growth in volume sales, with increases of 18.3% and 1.6%, respectively.
The US-Iran conflict was frequently cited in the commentary of BMBI panel experts.
Andrew Simpson, Packed Products Director at Heidelberg Materials, and BMBI’s expert on cement and aggregates, said: ‘Quarter one was tough for bagged cement and aggregate sales as weak construction and housebuilding activity, above average rainfall and the war in Iran affected supply and demand.
‘The war in Iran is having a huge impact on the market and customers. We are trying to keep price increases to a minimum, but rising oil prices affects everything from operational and transport costs to the price of packaging. For customers, elevated energy costs and market uncertainty is denting business confidence and some major projects, including the OpenAI Stargate project, are being shelved until conditions improve.
‘Big infrastructure projects, such as HS2 and Sizewell C, are pushing up crushed rock volumes (+1% quarter-on-quarter) but there aren’t enough major schemes under construction to make up for shortfalls elsewhere.’
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