​In early April 2025, President Donald Trump announced a sweeping set of import tariffs, including a 10% baseline on all imports and significantly higher duties on countries like Cambodia, Vietnam, and China. The European Union faces a 20% tariff, prompting threats of countermeasures. These developments have raised significant concerns about their potential impact on the UK construction industry, particularly regarding the supply and cost of essential materials like steel and aluminium.

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Increased Material Costs

The reimposition of a 25% tariff on steel imports to the US, without exemptions, has disrupted global trade flows. This move affects UK steel exports to the US, valued at approximately £400 million in 2023, making the US the UK's second-largest export market for steel after the EU. The tariffs could lead to increased competition for steel supplies, driving up costs for UK construction firms that rely on US-manufactured steel or global steel markets influenced by US tariffs.

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Supply Chain Disruptions

The tariffs may lead to a reorientation of global steel trade routes, with countries affected by US tariffs seeking alternative markets. This shift could result in increased imports from nations like India, Vietnam, and China to the UK, potentially leading to an oversupplied market and price volatility. Such fluctuations pose challenges for UK construction projects, which depend on stable and predictable material costs.

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Project Viability and Planning

Infrastructure projects in the UK may face heightened risks due to the tariffs. Increased material costs and supply uncertainties could lead to project delays, budget overruns, and, in some cases, the reconsideration of project feasibility. Large-scale projects, already complex and susceptible to various risks, may find it more challenging to navigate the additional uncertainties introduced by these trade policies. ​

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Strategic Responses

In response to the tariffs, some UK companies are adjusting their strategies. For example, British machinery manufacturer JCB has announced plans to double the size of its upcoming factory in San Antonio, Texas, in response to newly imposed 10% U.S. tariffs on imported UK goods. Originally planned as a 500,000 sq ft facility, the plant will now span 1 million sq ft and employ up to 1,500 workers. Chairman Lord Bamford emphasised the importance of local production in the U.S., JCB’s largest market since 1964, and said the move was influenced by the new trade barriers. ​

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Conclusion

President Trump's new import tariffs introduce significant challenges for the UK construction industry, affecting material costs, supply chain stability, and project viability. Construction firms must closely monitor these developments, assess potential impacts on their operations, and develop strategies to mitigate risks associated with increased costs and supply uncertainties. Engaging with policymakers and industry bodies to advocate for favourable trade terms and seeking alternative supply sources may also be crucial steps in navigating the evolving trade landscape.​

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Sources: The Guardian, The Times, UK Steel, BCIS, New Civil Engineer.