Australia’s construction industry next construction shock is copper, as prices of the mineral rise due to global electrification, data centres and grid investment.
According to Altus Group, copper prices have jumped 16.5 per cent year-on-year, surpassing US$13,000 per tonne in early 2026.
The increase in prices was driven by tight mine supply and a structural surge in demand from electrification, renewables and data centres.
The rise in copper prices is significant for the construction sector, as copper is integrated late in the building process through the services trades, including in electrical cabling, mechanical systems, plumbing, and vertical transport. Due to the difficulty of finding alternatives or deferring these components, the services trades are particularly vulnerable to “pricing versus mobilisation” risk.
On larger jobs, that cost escalation is frequently measured in six figures, with two further price rises in electrical cable expected this year.
With the Australian Securities and Investments Commission recording nearly 1,900 construction insolvencies in the first half of the 2026 financial year, the copper shock is more than a price spike, it is a fundamental threat to project viability.
Altus Group’s latest data shows the varying outlook on construction cost escalation among Australian capitals.
Brisbane is expected to remain the nation’s escalation hotspot through to 2027 with construction costs expected to rise 7.50 per cent in 2026 to 7.75 per cent in 2027, fuelled by Olympic-related works, persistent labour shortages and supply chain pressures.
In comparison, cost escalation in Sydney and Melbourne has cooled due to weaker construction pipelines and fewer major project starts.
Perth is also easing after its recent resource-driven spikes. Nevertheless, escalation rates remain well above pre-2021 levels, with meaningful relief unlikely before 2028.