The Section 122 tariff framework expires on July 24, 2026. If you have active bids or backlog pricing that runs past that date, your margin assumptions are about to be tested. Here’s what Carolinas commercial contractors need to know—and do—before the deadline hits.

Key Takeaways

• The July 24, 2026, deadline is non-negotiable. The temporary 10% Section 122 tariffs expire that day, with Section 301 replacement duties creating a more complex, country-specific tariff map that could raise or lower costs depending on your material sources.The
• Spring 2026 cost baseline is already elevated. The producer price index for construction materials hit 354.9 in March 2026 (a new all-time high, +6.0% YoY), COMEX copper trades near $5.76/lb (+32% YoY), steel pipe and tube are up 12.5% YoY, and cement has climbed 7.7% YoY.
• Carolinas markets amplify national pressure. Charlotte’s #25 MSA Construction Potential ranking, 4.8% construction GDP growth, the NC data center corridor, and infrastructure work along I-85, I-77, and I-95 keep local demand—and prices—running hot.
• The Section 301 comment window is May through early June 2026. This is your chance to influence phase-in timelines and tariff rates on steel, cement, and electrical components. ABC Carolinas is coordinating member input.
• Act now: review escalation clauses, stress-test backlog, map supply chain exposure by country of origin, and build procurement diversification into late-2026 and 2027 bids.

Why Construction Material Costs Matter Now in the Carolinas

Construction material costs are driven by geopolitical volatility, trade policies, and labor constraints—all factors hitting Carolinas contractors simultaneously in 2026. This isn’t abstract policy; it’s the difference between profitable projects and loss-leaders.

• Active project exposure: Charlotte, the Research Triangle, Upstate SC, and Charleston’s industrial corridor all have work breaking ground through 2027 that’s priced on assumptions that may not hold past July.
• Contract structure risk: Fluctuating material costs and input costs feed directly into GMP and fixed-price bids. Firms with thin margins on long-duration infrastructure jobs along I-85, I-77, and I-95 face the greatest exposure.
• Regional demand intensity: Charlotte’s #25 national MSA Construction Potential ranking and ~4.8% YoY construction GDP growth mean local subcontractor capacity is already stretched—amplifying any cost trends.
• Sequel to foundational coverage: This article extends ABC Carolinas’ earlier Construction Material Tariff Costs 2026 post, shifting focus from Section 122 margin protection to the procedural transition to Section 301.
• Audience: This is written for construction executives, estimators, and CFOs who need time-sensitive guidance, not a generic overview of the construction industry.

Where Construction Materials Costs Stand in Spring 2026

Current cost trends reflect persistent inflation beyond general CPI, with construction materials rising over 3.5% year-over-year as of early 2026, and metal products especially impacting costs.

• Producer Price Index: The PPI for construction materials hit 354.9 as of March 2026 (per April 2026 Barnes Dennig data), a new all-time high and +6.0% YoY.
• Copper: COMEX copper trades near $5.76/lb, up roughly 32% YoY, driven by AI data center demand, grid upgrades, EV infrastructure, and Chinese smelter cuts reducing refined supply.
• Steel pipe and tube: Up 12.5% YoY, affecting mechanical, process piping, and industrial work common in Charleston’s port-adjacent facilities and Upstate SC manufacturing plants.
• Cement: Up 7.7% YoY, with more pronounced effects on tilt-wall industrial, distribution centers along I-85, and large-footprint data center slabs. Surging fuel and energy prices, driven by geopolitical conflicts, raise the cost of producing and transporting heavy materials such as cement and concrete. A 30% jump in natural gas prices and oil near $100/barrel have significantly increased manufacturing and freight costs.
• Lean inventory reality: Distributors hold minimal stock (30-60 day rolling allocations, just-in-time deliveries), leaving little buffer if a single mill, port, or fabricator is disrupted.
• Category divergence: While some other materials, like certain finishes, remain more stable, core structural and MEP-related construction materials costs remain the primary margin risk. Material price volatility has become more uneven across categories, with different materials following their own pricing patterns.

From Section 122 to Section 301: The Tariff Transition Timeline

The procedural shift from Section 122 to Section 301 is the core roadmap contractors must understand. Changes in building codes, tariffs, and environmental regulations can inflate construction costs—and this transition introduces significant uncertainty.

• IEEPA ruling: A court ruling struck down the original blanket tariff system for exceeding presidential emergency authority under IEEPA, forcing the federal pivot.
• Section 122 stopgap: The administration implemented a temporary 10% Section 122 tariff on a broad range of imported materials, which is scheduled to expire on July 24, 2026.
• Section 301 replacement: Section 301 of the Trade Act serves as the long-term mechanism for addressing unfair trade practices, structural excess capacity, market distortions, and forced labor concerns. New tariffs on imports, especially for steel, aluminum, and copper, have significantly increased input prices, with some tariffs reaching up to 50%.
• March 2026 investigations launch: Formal Section 301 investigations targeting steel products, aluminum, cement clinker, rebar, pipe, tube, and certain electrical components began.
• May–early June 2026 comment window: The U.S. Trade Representative (USTR) accepts public comments via Regulations.gov, allowing contractors and trade associations to document real-world effects on supply chains and construction employment.
• July 24, 2026, hard cutoff: Section 122 expires. Without a well-designed Section 301 schedule, contractors could see abrupt changes in producer price levels and in the availability of targeted building materials.
• Country targeting: Countries with documented structural excess capacity (e.g., China) and those tied to forced labor allegations face the highest replacement duties under Section 301.

How the Tariff Shift Could Reshape Construction Material Prices

As Section 122’s blanket 10% duty comes off, Section 301 will create a more uneven landscape of material costs, with different producer price impacts by product and country of origin.

• Steel products: Higher Section 301 tariffs on steel pipe, tube, and structural shapes from excess-capacity countries could lock in or extend current 12.5% YoY steel prices, particularly for industrial, healthcare, and infrastructure jobs.
• Copper wire and products: Copper may not face the harshest Section 301 tiers, but its price will stay elevated due to global demand and smelter cuts. The ~$5.76/lb level is a realistic bidding assumption, not a spike.
• Cement and clinker: Cement sourced from high-emissions or forced-labor jurisdictions could see new duties, pushing prices beyond the current 7.7% YoY increase. Supply and demand dynamics significantly influence construction material prices.
• Electrical components: Switchgear, busway, tray, and specialty cable, heavily sourced from targeted countries, could be swept into Section 301 actions, stressing projects in the NC data center corridor. High demand for megaprojects and infrastructure has strained the supply of specialized electrical equipment and transformers, resulting in lead times of up to 120 weeks for some components.
• Lean inventory risk: Limited buffer at domestic distributors means that if a single foreign mill or port affected by Section 301 duties slows shipments, local prices can move quickly. Prices for construction materials are influenced by supply chain disruptions, including shipping delays, port congestion, and labor strikes.
• Material-specific strategies required: Contractors cannot rely solely on headline cost trends; they need to understand which SKUs in their bill of materials are most exposed to Section 301 risk.

Local Market Pressures in North and South Carolina

National construction materials cost trends and tariffs hit harder in high-demand Carolinas markets, where capacity is already strained.

• Charlotte logistics hub: Charlotte’s #25 MSA ranking and ~4.8% construction GDP growth keep subcontractors and suppliers near capacity, amplifying material costs on bids.
• NC data center buildout: Multi-hundred-million-dollar AI and cloud campuses in Charlotte and the Research Triangle require massive packages of copper, steel, HVAC, and electrical materials, intensifying competition for key materials.
• I-85/I-77/I-95 infrastructure: Ongoing widening, bridges, and interchanges are cement-, steel-, and asphalt-intensive, adding background demand that keeps regional construction material prices elevated.
• Charleston industrial corridor: Port expansion, distribution centers, cold storage, and light manufacturing rely heavily on imported materials and equipment, making Charleston more sensitive to shifts in Section 301.
• Upstate SC manufacturing: Automotive and advanced materials expansion pulls on local concrete suppliers and steel fabricators. Rapidly growing areas often face shortages of skilled labor, leading to higher labor costs and increased demand for materials.
• Risk translation: In high-demand markets with constrained capacity, volatile input costs quickly translate into surcharges, short quote validity windows, and higher supplier contingencies. Labor now represents roughly 70% of the total installed cost for materials like drywall, making workforce availability a major pricing factor.

Action Plan Before the July 24, 2026, Section 122 Expiration

Current market instability often necessitates that contractors factor in a 15% waste margin and use “escalation language” in contracts to protect against price hikes. Here’s what to do this quarter:

• Review active contracts: Flag all fixed-price or GMP work running past Q3 2026 that lacks explicit material price protections. Efficient material use, such as minimizing waste and recycling materials, can help control material costs.
• Stress-test backlog: Run scenarios assuming Section 301 duties increase landed costs by 5-15% from targeted countries. Quantify gross margin impact and working capital requirements.
• Tighten procurement timelines: Coordinate with preferred suppliers to lock in pricing windows. Use shorter quote validity periods and pre-negotiated index-based adjustments tied to the producer price index. Locking in material prices through long-term contracts can provide protection against sudden price increases.
• Map supply chain exposure: Document country of origin for high-value items (structural steel, pipe, tube, switchgear, specialty cable) so you know exactly where Section 301 risk sits. Geopolitical tensions, trade disputes, and changes in international trade policies can disrupt supply chains for construction materials.
• Align internal teams: Create a common material risk playbook with triggers for rebid, re-sourcing, or change order requests when material prices move beyond set thresholds. Proactive purchasing, buying materials well in advance, helps lock in prices and avoid future hikes.

Shaping the New Rules: Using the Section 301 Comment Process

USTR’s Section 301 docket accepts public comments in May and early June 2026 via Regulations.gov. This is the contractors’ direct channel to influence tariff outcomes.

• Coordinate through ABC Carolinas: Work with the chapter to submit comments highlighting how specific tariffs on steel, pipe, cement, and electrical components affect commercial construction, infrastructure schedules, and employment in North and South Carolina.
• Provide concrete examples: Reference recent bids where material costs jumped—steel pipe +12.5% YoY, cement +7.7% YoY, copper +32% YoY—and explain how further increases from Section 301 duties would erode margins or delay work.
• Emphasize predictability: CFOs and executives should stress the importance of predictable input costs, diversified sources, and reasonable phase-in timelines so contractors can adjust procurement strategies without destabilizing ongoing jobs.
• Leverage advocacy resources: ABC Carolinas and the Free Enterprise Alliance translate jobsite realities into policy language, increasing the odds that construction industry concerns shape the final Section 301 tariff schedule.

Strengthening Cost Control and Procurement Strategy

Connect tariff policy to day-to-day cost control by implementing procedural improvements in estimating, purchasing, and project controls. Inflation, supply chain constraints, and geopolitical tensions are significant drivers of volatility in construction material prices.

• Track category-specific indices: Monitor PPI for steel mill products, concrete, and nonferrous metals—not just general construction indices—to time major buys.
• Diversify procurement: Qualify multiple mills, fabricators, and distributors in different regions and countries, reducing reliance on any single supplier targeted by Section 301. To mitigate higher prices, contractors are exploring alternative materials such as recycled steel, engineered wood, and sustainable options like bamboo.
• Build flexible sourcing into estimates: Base bids on domestic or low-risk sources where possible, with clear alternates for higher-risk imports.
• Implement internal dashboards: Flag when actual material purchases deviate from bid assumptions on steel, copper, or cement, triggering early conversations about change orders. Inflationary pressures contribute to rising material costs across the economy.
• Tighten approval thresholds: Ensure substitutions don’t inadvertently increase exposure to higher-tariff origins or fragile supply chains.

How ABC Carolinas Helps Members Control Material Costs

ABC Carolinas, as a regional construction trade association for North and South Carolina, supports members navigating the tariff transition and managing construction materials costs.

• Intelligence aggregation: The chapter shares Section 301 developments, regional supply trends, and data through briefings, newsletters, and member alerts accessible via the ABC Carolinas website.
• Advocacy representation: ABC Carolinas represents merit shop contractors in Raleigh, Columbia, and Washington, partnering with ABC National and the Free Enterprise Alliance to ensure commercial contractors’ interests are heard during the Section 301 process.
• Peer groups and networking: Member peer groups and networking events connect project managers, estimators, and CFOs sharing real-time insights on material prices, delivery times, and supplier behavior in Charlotte, the Triangle, Upstate SC, and Charleston.
• Workforce development: Apprenticeships, safety training, and education programs help members manage broader job costs and productivity, cushioning the impact of volatile material prices on total budgets. High fuel prices drive up transportation expenses, which are passed on to customers through higher material costs.
• Foundational framework: This article extends ABC Carolinas’ Construction Material Tariff Costs 2026 post—review that piece for the Section 122 margin protection strategies that remain relevant through the transition.

What to Build into Bids for Late 2026 and 2027 Projects

For projects breaking ground after Section 122 expires, embed material price risk into proposals using these approaches. Higher construction costs due to rising material prices can lead to delays and increased financial risk for contractors and developers.

• Conservative pricing assumptions: Use copper at ~$5.50–$5.75/lb and steel pipe/tube reflecting at least the recent 12.5% YoY rise—don’t assume reversion to pre-2024 pricing.
• Label escalation assumptions explicitly: Tie key line items to specific producer price indices or supplier schedules, making clear when pricing depends on Section 301 outcomes.
• Add structured allowances: Include allowances for high-volatility materials (steel, copper, cement, critical electrical gear) with clear reconciliation mechanisms. Builders and developers need to understand that material prices represent shared risk.
• Shorten bid validity: In high-risk material categories, negotiate re-pricing rights if Section 301 actions materially change landed costs between bid submission and award.
• Competitive advantage through preparation: Firms with diversified procurement, strong supplier partnerships, and active participation in ABC Carolinas’ information-sharing networks can offer more competitive yet protected pricing than less-prepared competitors. The rise in building material costs is harming housing affordability as higher construction costs are passed on, making the stability of your cost assumptions a market differentiator.

FAQ: Construction Material Costs and the Section 301 Transition

How is this different from the earlier Section 122 material cost environment?

Section 122 imposed a broad, temporary 10% blanket duty with relatively simple rules across construction materials. Section 301 creates a more targeted, product- and country-specific tariff map, making exposure more uneven. Your steel from one country might face 25% duties while the same product from another faces 10%—or none. This requires material-by-material, origin-by-origin analysis rather than simple percentage assumptions.

Which materials used in Carolinas commercial projects are most exposed to Section 301 risk?

Steel products (plate, shapes, pipe, tube), cement and clinker, certain aluminum items, and selected electrical components imported from high-capacity or forced-labor jurisdictions are most likely to see higher replacement duties. Projects in Charlotte, the Triangle, Upstate SC, and Charleston should map exposure by SKU and supplier to understand their specific risk profile.

What can smaller contractors do if they lack in-house trade policy expertise?

Lean on ABC Carolinas resources, join peer groups, and coordinate with trusted suppliers for origin and tariff intelligence. Adopt simple practices: clear escalation clauses, index-based pricing references, and structured allowances. You don’t need complex internal models—you need access to good information and contracts that protect you when prices move.

Will material prices fall once Section 122 expires on July 24, 2026?

A broad price drop is unlikely. Global demand (AI data centers, infrastructure, automation, EVs) and tight capacity continue pushing up input costs regardless of tariff policy. Any relief from lower duties on some items could be offset by higher Section 301 tariffs on others and by ongoing producer price pressures from factors such as lumber supply constraints and overall inflation. Plan for stability at current levels, not a return to 2023 pricing.

How often should we revisit our material assumptions for active bids in 2026?

At a minimum, review key materials (steel, copper, cement, major electrical items) monthly. Add additional checks around key regulatory dates: the March Section 301 launch, May–June comment window, and July 24 expiration. This cadence lets estimators and CFOs adjust pricing or contingencies before commitments lock in. Deal with uncertainty by building review triggers into your process—not by hoping the market will resolve itself.