The latest Spring 2026 Construction, Cement & Concrete Outlook from The Sullivan Report reveals the impact of the Iran conflict, economic uncertainty and the industries’ recovery timeline shifting.
Construction materials economist Ed Sullivan, author of The Sullivan Report, said, “The U.S. cement market has been in a decline for three consecutive years. This translates into more than a 10 million metric ton decline since 2022. The volume loss has pushed clinker utilization rates lower, reduced reliance on imports, and prompted a moderation in cement and concrete pricing.
“The principal reasons for this retreat have been sustained high interest rates and inflation’s erosion in the strength of public-spending programs. These dual adverse impacts have constrained private and public spending. These forces have been recently supplemented by a slowdown in job creation.
“While some regional markets have been lifted by vibrant data center and other meg-project activity, these projects have not been enough on a national basis to offset the combined weakness in the construction market brought on by high interest rates, inflation, and adverse net operating conditions.
“The Iran conflict introduces new uncertainty into the 2026 outlook. For a construction outlook already dependent on declining long-term rates, the risks are significant. At this time, no one knows the scope of the conflict and its resulting impact on interest rates, inflation and economic activity. To this end, we offer three scenarios that differ depending on the length of the conflict and blockage of shipping through the Strait of Hormuz.
“In each scenario, the conflict in Iran heightens the probability inflation and overall economic conditions will worsen. The Federal Reserve will likely adopt a wait-and-see approach toward future rate cuts. No improvement in interest rates or inflation is expected anytime soon.
“The conditions necessary to bring about a recovery in construction activity will be delayed by the Iran conflict. A construction recovery that was expected to begin in the second half of the year, now seems less likely. The potential of a fourth year of decline in cement consumption is now on the table for consideration.”
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