Pricing a Moving Target
Steel, aluminum, and copper carry the heaviest tariffs in years, and input prices are climbing at the fastest pace since 2022. Here is how we are writing volatility into a number a client can trust.
Devon Achebe, Director of Strategy & Compliance · Edited by Jules Whitfield
Here is the number that changed our estimating this spring. Construction input prices rose at a 12.6 percent annualized rate in early 2026 — the fastest since 2022. Under that headline sits a harder set: as of April, steel, aluminum, and copper made mostly of those metals carry a 50 percent tariff, with derivatives at 25 percent. Copper wire and cable are up 22.3 percent year over year. Aluminum mill shapes, up 30.5 percent.
Copper is the one to watch, and not because of tariffs alone. Every AI data center, every grid expansion, every battery-storage project is pulling on the same copper. Demand is structural, not a spike. That matters for us because copper is not some exotic line item — it is the wire in every building we touch.
A fixed price on a moving cost is a guess
The old reflex was to hold a hard number and eat the variance. That worked when materials moved two or three percent a year. It does not work now. A firm that quotes a fixed price on copper-heavy or steel-heavy scope in this market is not being confident. It is gambling, and on public work the house does not cover the loss — the contractor does.
“A fixed price on a cost that moves 12 percent a year is not confidence. It is a bet, and you are covering the spread.”
So we have gotten specific. We separate scope into what is price-stable and what is exposed, and we treat them differently. Stable scope gets a firm number. Exposed scope — structural steel, electrical, anything metal-heavy — gets an escalation clause tied to a published index, or an early-buy provision that lets the client lock a price by ordering ahead. We show the client both the number and the mechanism that keeps it honest.
Volatility is the condition now, not the event
The temptation is to treat this as a storm to wait out. It is not. Volatility has moved from disruption to a defining feature of the market — some trades stable, others swinging hard, region to region, quarter to quarter. Planning as if a calm baseline is coming back is how you get caught.
The honest version of a bid in 2026 is not a single confident number. It is a number, plus a clear statement of what could move it, plus the contract language that decides who carries that risk. Clients do not love the escalation conversation. They love a surprise change order in month nine a great deal less. We have found it is far easier to explain a contingency up front than to defend a variance after the fact.
How this piece came together
Figures reflect published 2026 producer-price and tariff data as of the second quarter; specific numbers move quarter to quarter, and any escalation language should be checked against the current index before it enters a bid.
Written by Devon Achebe, Director of Strategy & Compliance. Edited by Jules Whitfield.