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BESIX Watpac has warned that Donald Trump’s move to double US steel tariffs is set to create fresh uncertainty across global construction supply chains, just as the company returns to profit after two years of losses.

Key points for builders and contractors:

• Steel tariffs rise: US steel and aluminium tariffs jump to 50%, raising concerns for builders reliant on global supply chains.

• Ripple effects: Although Australia doesn’t import much US steel, ongoing trade tension with China could push up prices for materials sourced from Asia.

• Contract risk: With rising uncertainty, contractors may try to negotiate rise-and-fall clauses in contracts, but softening work levels and stiff competition may limit client flexibility.

• Practical advice: Builders should plan with a 6–12 month view and consider contract terms that reduce exposure to volatile input costs.

Notable quotes:

• “We can’t take for granted the market’s back to normal.” — Mark Baker, CEO, BESIX Watpac

• “Contractors should be... looking for mechanisms in contracts [to reduce their risks].” — Matt Mackey, Arcadis

Outlook:

• Domestically, political stability may support housing and infrastructure.

• Arcadis forecasts construction cost growth will slow in Sydney and Melbourne but remain high in Brisbane and Perth.

Takeaway:
Builders should stay agile. Factor in short-term planning windows, negotiate for risk-sharing clauses where possible, and prepare for potential flow-on price hikes in steel and other materials.

_{This summary is based on an published by Michael Bleby in The Financial Review titled ‘Builder Watpac warns of supply chain risk from new US steel tariffs’ on 2 June 2025.}