Construction materials prices rise sharply, Ministry of Construction proposes countermeasures

Due to a sharp rise in construction material prices, the Ministry of Construction has urged provincial authorities to actively balance resources, prioritize the completion of key projects, and strictly enforce regulations on the management, publication, and updating of construction material prices. The ministry also called for close oversight of fuel and building material enterprises to prevent hoarding, speculation, and price gouging.

Fuel price volatility and pass-through to construction costs

The ministry said it recently submitted a report to competent authorities on the impact of fuel price volatility on construction investment. After a period of relative stability in 2025 and the first two months of 2026, fuel prices increased in March, particularly diesel. Asphalt prices rose by more than 30%.

The ministry noted that higher fuel prices have fed through to production and transport costs for most construction materials. By March 31, compared with February 2026, cement increased by more than 7%, steel by more than 2%, ceramic tiles by nearly 5%, and sand, stone, and bricks by 13.5–23.3%. Asphalt rose by about 32%.

Ministry forecast for material price trends

The Ministry of Construction forecasts that construction material prices will continue to rise in the near term. Based on the price and fuel volatility described above, estimated construction costs for projects could increase by approximately 1.91% to 8.09% relative to February 2026, depending on project type.

Estimated cost increases by project type

• Transport projects: up to 8.09%
• Agricultural and rural development projects: up to 4.55%
• Technical infrastructure: up to 2.52%
• Civil works: up to 2.02%
• Industrial projects: up to 1.91%

Scenario analysis: fuel prices rise 100%

Under a scenario in which fuel prices rise by 100% from February 2026, transport infrastructure projects would be most affected, potentially raising costs by around 16%. Industrial projects would be the least affected, with increases approaching 4%.

Implications for key projects and state budget pressure

Statistical data cited by the ministry show that 44 priority projects under the Steering Committee for key projects have total investment of about 569 trillion dong. Of this, construction costs account for about 413 trillion dong, while the remaining unexecuted value is about 267 trillion dong.

In the 100% fuel price scenario, for priority transport projects alone, construction costs could rise by about 42.3 trillion dong. The ministry said this would create significant pressure on the state budget.

Proposed measures to manage costs and maintain project progress

The ministry outlined steps to adjust plans and balance costs, including monitoring Middle East conflicts that may extend and affect fuel prices, and following the Prime Minister’s directions to ensure resource balance and prioritization of major infrastructure projects.

Local authorities were instructed to strictly monitor fuel and building material companies to prevent hoarding, speculation, and price gouging. They should also tighten control of mineral extraction and enhance dissemination of contractual law to ensure careful contract formation and proper price adjustment methods.

Investors and project management boards are responsible for tight cost control: assessing the impact of price changes on projects, adjusting plans and contingencies accordingly, and reviewing ongoing contracts—especially turnkey and fixed-price contracts—in coordination with contractors to address issues and ensure progress.

The ministry also directed investors and contractors to review demand for fuels and construction materials to ensure continuous construction.