29 June 2026

This Week’s Cost Intelligence

 

The gentle drift of recent weeks turned into a proper step down. The UAE index fell 1.74% to 120.14, its fifth consecutive weekly decline and the largest of the run, though it still sits 20.14% above the September baseline. The KSA index moved the same way, easing 1.92% to 108.70, which leaves it 8.70% above baseline. The two indices share the same global materials basket, so the difference between them is a local story of cement, concrete, labour and diesel rather than a different market.

 

Last week’s split between firming and softening metals has closed up. This week almost everything gave ground together. Bitumen was the only riser, and only just, at 0.31%, CRC held flat, and the remaining ten materials all fell, led by nickel at 7.89% and aluminium close behind at 7.82%.

 

Freight has finally split. The dry-bulk indices eased for the first time in months, with the Baltic Dry down 7.23% and Capesize down 13.16%, but container rates rose again by 3.78% on top of a sharp jump across June as a whole. The caution therefore narrows rather than lifts, containerised imports still need pricing on landed cost, while bulk-shipped lines get a little relief.

Currency has swung back the buyer’s way. Where the Dirham and Riyal eased last week, this week they firmed against every tracked currency bar the Indian Rupee, which was flat, with the Australian Dollar and the Euro giving up the most ground. That trims a little from foreign-currency imports across the board. The US Dollar stays pegged and does not move against either, so dollar-denominated buys are unaffected.

 

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Copper – Buying Window (▼)

 

Forecast:  Copper gave back 4.07% this week, handing back last week's gain and more as the broad metals sell-off pulled LME/COMEX pricing to USD 13.44/kg. The monthly line is down a matching 4.12%, yet the position remains 35.14% above the September baseline and the electrification and data centre demand story is unchanged, so this reads as a pull-back within a firm trend rather than a turn. Dips in this line have been shallow and short-lived all year.

 

Action:  treat the week as an entry point. Lock forward cover on cabling, busbar and MEP packages while the window is open, rather than waiting for a deeper fall that may not come.

 

Zinc – Decrease (▼)

 

Forecast: Zinc fell 3.42% on the week against a monthly decline of just 1.35%, which marks the move as recent and still developing rather than a settled correction. The line remains 22.96% above baseline and 27.78% up year-on-year, so there is room for further softening before it finds a floor. Galvanising, coating and alloy lines should follow it down with a short lag.

 

Action: watch rather than act. Hold tender validity on galvanised and coated scopes where possible, and revisit rates at the next weekly close before committing.

 

Diesel & Plant – Elevated (▲)

 

Forecast:  Diesel is held at AED 4.33/L and SAR 1.79/L on the June schedules, keeping the UAE Plant line at an elevated 153.36 against a steadier 106.66 in KSA, where administered pricing continues to shelter running costs. The July ADNOC reprice lands within days and Brent's retreat to the mid-nineties offers some hope of relief, but until it prints, plant and logistics rates stay the firmest line in the index.

 

Action:  hold plant-heavy rates at current levels until the July schedule publishes, and avoid baking June fuel pricing into long-duration commitments. Note also that cold-rolled coil remains held at USD 593/t pending source access, with external series evidence of roughly 3.2% firming within the cycle, so treat flat CRC pricing as a floor.

 

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Currency Impact on This Week's Costs

 

The short version: this week the Dirham and the Riyal firmed against almost everything we follow, so your money stretches a little further on anything bought abroad. Every imported package priced in a foreign currency is a touch cheaper than last week. The move was nearly one-sided, only the Indian Rupee edged the other way and barely, whilst the Dollar did not budge, since it is pegged to both currencies by law. A UAE project and a Saudi one therefore sit in exactly the same place.

 

The falls worth pricing in are at the top of the range. The Australian Dollar led, down 1.50%, so Australian-priced supply is the clear winner this week. The Euro followed at 0.66%, trimming European steel and facade work, and the Chinese Yuan eased 0.42%, which matters more than its size suggests because it feeds the China-sourced bitumen, polyvinyl, rebar and cold-rolled coil the index tracks. Below those, the Yen (0.22%), Singapore Dollar (0.15%) and Pound (0.07%) barely moved, small enough to note and fold into the next quote rather than act on. The Rupee firmed a marginal 0.04%, and the Dollar held flat.

 

What This Means for Construction

 

Picture it as a small, even discount sitting on top of every imported package, less a story about any one country than about which currency you happen to be paying in. Buying in Australian Dollars or Euros, the fall is big enough to capture on a new order this week, European steel and facade scopes being the obvious candidates. Paying in Yuan, Yen, Singapore Dollars or Pounds, treat it as a minor tailwind and move on. The advice either way is the same: build the small saving into new orders where you can, and leave anything already signed or covered exactly where it is. Nothing here justifies reopening a contract in either direction.

 

The Practical Read

 

A slightly firmer week for buyers, and a helpful one. Everything imported is a little cheaper, led by the Australian Dollar, Euro and Yuan. The move is modest and could reverse if the Dollar softens, so capture it in new orders without over-reacting. And since the Dirham and Riyal move together through the Dollar, there is no advantage either side of the border.

 

 

Stonehaven Procurement Strategy Index (SPSI)

 

The SPSI scores procurement risk in one number, built from three inputs:

 

• Market Volatility (MVEI) – the size of material price moves

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• Import & Currency Exposure (ICEI) – the cost effect of currency swings on imports

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• Energy & Logistics (ELEI) – the pressure from fuel and freight

Each runs 1 to 4, from calm to high risk. The combined score uses the same scale:

 

• Below 1.49: Low risk – steady market, minimal movement

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• 1.5 to 2.24: Mild risk – small moves, light monitoring

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• 2.25 to 3.24: Moderate risk – clear movement, targeted action

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• Above 3.25: High risk – unsettled market, immediate review

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Current Position (29 June): SPSI = 1.70 (Mild Risk)

 

• MVEI = 2 → mild material price volatility. Eleven of the twelve traded lines fell together this cycle, led by nickel and aluminium at close to 8%, and the raw score of 2.18 sits in the upper half of the mild band. The move is broad but orderly, wide enough to matter for timing yet short of the disorderly threshold.

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• ICEI = 1 → low import and currency exposure. The Dirham and Riyal firmed against every major except a marginal Indian rupee move, so the currency channel sits at the bottom of the scale this cycle, even as the structural reliance on imported metals and coil persists.

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• ELEI = 2 → the line stepped down. Diesel held at AED 4.33/L and SAR 1.79/L and dry-bulk freight broke lower (Baltic Dry down 7.23%, Capesize down 13.16%), and although container rates firmed 3.78% the climb slowed below the elevated band, easing the logistics contribution from the prior cycle.

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Methodology of SPSI Calculation:

 

One weighted score from three sub-indices: Market Volatility (MVEI) at 45%, Import & Currency Exposure (ICEI) at 30%, and Energy & Logistics (ELEI) at 25%.

 

The weighting follows the cost structure of construction. Material prices drive the largest weekly swings and take the top weight, import currency exposure ranks second, freight and energy third.

 

This week: (MVEI 2 × 0.45) + (ICEI 1 × 0.30) + (ELEI 2 × 0.25) = 1.70 (Mild Risk).

 

Interpretation:

 

The composite of 1.70 keeps the procurement risk environment in the Mild Risk band for the week ending 29 June 2026 and extends a steady easing, from 1.95 at 15 June to 1.75 at 22 June and 1.70 now. The improvement is driven by the logistics and currency channels: ELEI stepped down as the container-freight climb slowed below the elevated band, and ICEI sits at the bottom of the scale on a firmer Dirham and Riyal. The reading sits comfortably below the 2.25 Moderate threshold, with material volatility the only sub-score in the upper half of its band.

 

Buying conditions stay comfortable, and freight remains the single item to track. Dry-bulk shipping eased hard this week but containers kept climbing, and the container line is the one that reaches imported steel and finishes. A renewed acceleration in container rates is the path back towards Moderate territory, nothing else on the board points that way yet. Routine checks on the Baltic indices, LME inventories and AED/SAR cross rates will surface it in good time.

 

Procurement Recommendation

 

1. Material Procurement: With eleven lines correcting together, use the window selectively: take forward cover on copper for MEP and busbar scopes given the intact electrification story, average into the aluminium and nickel falls for facade and stainless packages, and time rebar and coil purchases against site demand rather than chasing the dip in one tranche. Hold flat-steel and coated-steel commitments against the China export-quota risk.

 

2. Currency & Import Strategy: The Dirham and Riyal firmed against every major except a marginal Indian rupee move this week, so every non-dollar import is fractionally cheaper, the Australian Dollar, Euro and Yuan most of all. Capture the shift on fresh euro, sterling and yuan quotes where you can, recognising the peg caps the size of the move, and leave signed contracts untouched.

 

3. Energy and Logistics Cost Management: Diesel unchanged at AED 4.33/L and SAR 1.79/L, so plant and haulage are flat this cycle, though the UAE July schedule takes effect 1 July with reset risk skewed upward while Saudi fuel stays anchored to January 2027. Freight is the split signal: dry-bulk eased sharply, helping imported steel and masonry, while container rates rose 3.78% with the Red Sea corridor still a live risk. Book container space and shipping windows early on import-heavy coil and finishes, and time bulk-cargo deliveries into the softer dry-bulk market.

 

4. Continuous Monitoring: Track the Baltic Exchange shipping indices, LME copper, nickel and platinum inventories, and the AED/SAR-EUR/GBP cross rates to catch any sustained escalation early. In the UAE, the 1 July fuel schedule is the one dated catalyst inside the next cycle; in KSA, watch cement and readymix list prices for pass-through from the January fuel step.

 

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Commercial Guidance

 

1. Structural & Metal-Based Packages

 

The complex corrected across the board this cycle rather than rotating. Copper eased 4.07% to 13.44 USD/kg, aluminium fell 7.82% to 3,099.80 USD/t and nickel 7.89% to 16,312 USD/t, whilst steel-rebar gave up 1.07% to 449.55 USD/t, so the long-product line softened alongside the non-ferrous fallers rather than holding apart.

 

Flat steel eased off its highs. Hot-Rolled Coil fell 2.65% to 1,176.00 USD/t and Cold-Rolled Coil was held flat at 593.03 USD/t for series continuity, so the structural frame sits marginally softer, with the long-versus-flat divergence still the line to watch against the China export-quota risk.

 

Bitumen was the sole riser, up a marginal 0.31% to 587.23 USD/t. The read for buyers is one-directional this week: eleven of twelve lines have corrected together and offer a broad buying window, with copper the priority given its structural trend, and the coil complex the line to keep under forward cover.

 

2. Industrial, Commercial & Infrastructure Projects

 

Demand across the data centre, logistics and infrastructure pipeline stays firm, so the broad metals pullback reads as a positioning unwind rather than a demand event. That makes this a tactical moment to call off against framework agreements on aluminium, nickel and facade-linked scopes while the softer levels hold, and to lock copper where cover is thin before it recovers.

 

Freight is the mixed signal this week. Dry-bulk eased sharply, with the Baltic Dry down 7.23% and Capesize 13.16%, though Panamax firmed 3.16%, which broadly trims the landed premium on bulk long steel. Container freight moved the other way, up 3.78%, so coil and containerised long-lead items still carry rising delivered cost.

 

For projects with heavy container-sensitive content, landed-cost contingencies should be held or reviewed upward. Diesel is unchanged at AED 4.33/L and SAR 1.79/L on the June schedules, so haulage and plant-running costs are steady, though the UAE July reprice lands within the next cycle, while the dirham and riyal firmed across the basket, a small tailwind on foreign-currency imports that the peg keeps contained.

 

3. MEP, Finishes & Specialist Imports

 

Copper eased 4.07% this week, so the MEP cabling, switchgear and busbar lines offer a rare entry point, take forward cover now while the window is open, before the structural trend reasserts. Nickel, down 7.89%, opens a clearer value window on stainless and specialist alloy packages and is one of the lines the workbook flags as a buy this cycle. Polyvinyl, down 2.69%, is also flagged as a buy this cycle, keeping drainage and containment inputs on the soft side.

 

Aluminium, down 7.82%, is the standout correction and a flagged buy, a tactical window on facade, cladding and architectural-metal scopes where programme cover is thin. Lead, down 3.60%, is a further flagged buy, useful for cable and battery-linked items. Bitumen firmed marginally, so treat committed roads and waterproofing cover as a hold-and-top-up rather than a fresh chase.

 

In short: use the corrected aluminium, nickel, polyvinyl and lead for value now, lock copper where the trend is up, hold existing bitumen cover, and keep container freight priced into every imported MEP and finishes line.

 

Procurement Strategy

 

A buy-into-weakness approach fits the cycle ending 29 June 2026. The breadth of the correction, eleven lines lower against a firmer dirham and riyal, argues for committing forward on the corrected metals now, opportunistic call-off against existing framework agreements on facade, stainless and containment packages while prices have fallen, set against copper and steel flats that warrant retained cover.

 

Forward cover remains warranted on copper, where the structural trend is up, and on flat and coated steel, where the China export-quota risk points up. Steel-rebar, CRC, titanium and bitumen movements sit within normal volatility tolerance and can stay under active monitoring.

 

Container freight remains the principal embedded cost amplifier and should be priced explicitly into landed-cost estimates rather than absorbed in general inflation contingencies. The sharp easing in dry-bulk freight offers a partial offset on long-steel imports, but does not extend to containerised inputs.

 

Overall Commercial Position

 

Construction cost risk eased visibly this cycle, printing the largest weekly fall of the quarter on a broad, orderly metals correction. The UAE index fell 1.74% to 120.14 and the KSA index 1.92% to 108.70, both genuine materials moves driven by the correcting basket rather than any mechanical effect, with energy and labour stable and FX a marginal tailwind. The UAE index sits 20.14% above its September 2025 baseline and the KSA index 8.70% above.

 

The corrected metals offer a broad buying window across facade, stainless, MEP and containment packages, while copper and flat steel warrant retained cover. Container freight continues to add embedded landed-cost pressure on imported coil and finishes, with the sharp easing in dry-bulk shipping a partial offset on long steel.

 

The current SPSI reading of 1.70 (Mild Risk) sits comfortably below the Moderate threshold and extends a steady easing, from 1.95 at 15 June to 1.75 at 22 June and 1.70 now. Material volatility and import exposure are both contained, leaving freight, specifically the container index, the principal watch item heading into the next cycle.

 

 

Important Disclaimer

 

The Stonehaven Cost Index (SCI) is for general information only and is not a commitment, guarantee, or offer to contract at any price. The index is based on publicly available commodity data and our internal market view as of 29 June 2026. Actual project costs depend on the specific scope, how you procure, and what's agreed commercially.

 

Stonehaven Project Management Services LLC accepts no liability for any loss caused by relying on this document without proper project-specific advice. The index shows general market movement based on weighted construction inputs.

 

Selected data points this cycle reflect manual review pending: the UAE Plant Index is held flat at 153.36 with diesel unchanged at AED 4.33/L on the June schedule, and the KSA Plant Index at 106.66 with diesel fixed at SAR 1.79/L under Aramco's annual review. Cold-Rolled Coil is held at 593.03 USD/t for series continuity as the primary source was unavailable, with alternative sources indicating roughly 3.2% firming within the cycle, so a higher print is likely once confirmed. Certain Baltic shipping benchmarks (Capesize, Panamax) may include proportional estimation. These items will be refreshed once full source confirmation is received.

 

FAQ's

 

1. What is the Stonehaven Construction Cost Index and how is it calculated?

 

The Stonehaven Cost Index (SCI) tracks weekly price movements across key construction materials, freight indices, and currency pairs relevant to the UAE and Saudi Arabia. Data is collected every week and reviewed by Stonehaven's cost management team before publication. The index is indicative and does not constitute a tender price or contractual valuation.

 

2. What affects construction material prices in the Middle East?

 

Several factors influence construction material prices in the Middle East, including global commodity markets, shipping costs, fuel prices and currency movements. Materials like steel, copper and bitumen are particularly sensitive to international demand and logistics conditions, which directly impact construction cost trends in the GCC.

 

3. How often do construction material prices change?

 

Construction material prices can change daily depending on global market conditions. Factors such as commodity prices, shipping costs and fuel rates influence short-term movements, which is why tracking weekly construction material price updates is important for sensitive cost planning.

 

4. How is the Stonehaven Construction Cost Index prepared?

 

The construction cost index is prepared using weekly data collection across key materials, currencies and freight rates. Cost managers monitor these movements to reflect current conditions. This is then reviewed by the commercial management alongside foreign exchange and logistics trends, which influence construction pricing across the GCC before presenting to our readers.

 

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