Construction materials: UNICEM warns of a slowdown in the recovery

A recovery weakened by the international context

According to UNICEM, the prospects for recovery observed at the beginning of 2026 were quickly hampered by several cyclical factors.

The conflict in Iran and tensions in the Strait of Hormuz have triggered an oil shock, leading to higher production and transportation costs. This situation is also fueling concerns about inflation, interest rates, and consumer confidence.

In the building and public works sectors, these parameters directly influence investment decisions, construction site costs and the ability of companies to maintain their operating margins.

The adverse weather conditions observed during the first quarter also disrupted production and implementation activities in several territories.

Aggregates and ready-mix concrete continue their downward trend

After a severely disrupted February, materials activity rebounded in March, but did not compensate for the losses recorded previously.

Aggregate production increased by approximately 5% month-on-month but remains down 1,3% year-on-year. Overall, for the first quarter, it remained stable compared to the previous quarter, while showing a year-on-year decrease of 3%.

Ready-mix concrete (RMC) is following a similar trajectory. Despite a 4% rebound in March, volumes remain below those observed in 2025, with a year-on-year decrease of 2,4%.

Over the quarter, BPE production fell by 4,2% compared to the end of 2025 and by 4,1% year-on-year.

The materials indicator confirms this trend with a generalized contraction affecting the majority of materials from the mineral sector.

Discrepancies between construction sites and material consumption

UNICEM highlights a contrast between relatively dynamic construction indicators and the still weak activity of materials.

This situation can be explained by start-up delays, postponements of construction projects or longer preparation phases before the actual implementation of the works.

In the construction industry, material producers are heavily dependent on the actual schedule of structural and finishing work, which is often out of sync with permit or construction start statistics.

"After a February severely disrupted by bad weather, materials activity recovered in March, but without making up for the declines recorded in February."

New housing: construction starts are up but the market is fragile

Residential construction indicators nevertheless show marked progress in the first quarter of 2026.

Housing starts increased by 9,5% over a quarter and by more than 30% over a year, mainly due to multi-family housing.

Building permits also increased by 17,2% over a quarter, reflecting a resumption of some projects postponed to 2025.

The non-residential sector remains on an upward trend, but at a more moderate pace.

Despite these encouraging indicators, the new real estate market remains weakened by a drop in demand and a decline in sales.

Developers report an increase in unsold housing inventory as well as a 14,3% drop in sales in the first quarter of 2026.

This situation leads to a contraction in new supply and increases uncertainty for real estate development operators.

Mortgage lending and household confidence under pressure

Interest rate increases remain relatively contained, with an average rate of 3,23% in April. However, household confidence is deteriorating significantly, according to economic indicators reported by UNICEM.

Credit production is slowing sharply, which is impacting individuals' ability to realize their real estate projects.

However, the market for single-family homes retains a certain resilience thanks to the zero-interest loan (PTZ) and the continued support from banks.

UNICEM is also observing the first positive effects of the Jeanbrun scheme with a rebound in sales to investors.

In the construction sector, these developments directly influence the visibility of craft businesses, materials manufacturers and project management players.

Public works: a sharper decline than anticipated

The climate is deteriorating further in public works.

According to FNTP data relayed in the publication, work carried out in the first quarter contracted by 6% compared to the previous quarter and by 6,3% year-on-year.

Public procurement also declined sharply, with a decrease of 17,2% year-on-year.

Companies in the sector cite several factors contributing to the slowdown: bad weather, the electoral context, rising energy costs and uncertainties related to the conflict in the Middle East.

This situation particularly affects activities related to infrastructure, urban development and networks.

Growing concern among businesses

UNICEM points out that 53% of public works companies report facing a lack of demand.

A level that had not been observed since October 2016.

For construction companies, this decrease in visibility can have direct consequences on recruitment, material investments and the planning of future construction sites.

Design offices and project managers also remain attentive to the evolution of raw material and energy costs, which may affect the economic balance of operations.

"The outlook is darkening: 53% of businesses are facing a lack of demand."

In this context marked by persistent economic and geopolitical tensions, the construction materials sector continues to face a fragile recovery. While some housing indicators show signs of improvement, industrial activity and public works continue to suffer the combined effects of the economic slowdown, energy costs, and investment uncertainties.