Canadian construction firms are being urged to step up supply chain risk management as geopolitical tensions and new trade barriers drive up the cost of critical materials, according to business insurer QBE.
In its latest report, Trade tensions and the construction sector: Navigating supply chain disruption, produced with Control Risks, QBE says companies must embed risk awareness into board-level decision-making to protect projects from delays and escalating costs.
Recent tariffs on steel, aluminum, timber, and copper are already disrupting procurement across North America and Europe. The United States has announced that tariffs on Canadian imports outside the Canada–United States–Mexico Agreement will rise to 35%, and 40% for goods re-routed through third countries. Steel and aluminum are among the hardest hit, with US tariffs pushing prices to multi-year highs. Timber costs continue to climb amid ongoing US–Canada disputes, while copper prices have surged 29% in early 2025, fueled by trade measures and strong demand from the electric vehicle and renewable energy sectors.
With Canada’s construction industry reliant on imported steel, aluminum, cement, and electrical components, the impact is being felt across the sector. The industry employs more than 1.6 million Canadians, generates around $151 billion annually, and accounts for over 7% of GDP. QBE says that protecting this economic engine will require firms to adapt quickly to shifting trade conditions.
From an insurance standpoint, companies can mitigate risks by engaging early with providers to tailor coverage for supply chain interruptions, cost overruns, and project delays. Policies such as delay-in-start-up, political risk, and trade credit insurance can help shield contractors from revenue loss and liquidity pressures. QBE also points to the importance of integrating insurance into broader contingency planning, ensuring that financial protections align with operational risk controls.
Ben Hunter (pictured), QBE’s Director of Canada, said the sector is navigating multiple challenges at once. “The confluence of global supply chain disruptions, rising material costs, labor shortages, and sustainability goals presents a complex risk landscape for the Canadian construction sector,” he said. “Canadian construction firms need to manage their supply-chain risks closely, be dynamic in financial planning, and work with partners who understand the evolving trade landscape.”
He added that working closely with insurers can help safeguard project continuity and financial stability as market pressures intensify.
