Asphalt Product Manufacturers NAICS 324121, 324122

Apr 4, 2025 - Highway, Street Projects Boost Nonresidential Spending

• The total value of construction put in place increased 0.7% in February compared to January, according to the US Census Bureau. Construction spending is a key demand driver for asphalt products used in roofing and paving. Spending on nonresidential projects rose 0.3% to a record $1.26 trillion. Residential spending grew 1.3%. Highway and street construction projects accounted for 40% of February’s nonresidential gains as public projects drove growth, according to Associated Builders and Contractors (ABC) analysis of US Census Bureau data. While public nonresidential spending was up 6.1% in February over the same month in 2024, private nonresidential spending has not kept pace, growing just 2.5% over the same period. In a press release, ABC’s Chief Economist Anirban Basu said, “The mix of high interest rates, tight lending standards, and unprecedented uncertainty regarding trade policy will continue to weigh on private sector construction in the coming months.”
• In late March, attendees of a regional residential construction trade show in Rhode Island mulled the impact tariffs will have on the industry’s supply chains, according to the Providence Journal. A manufacturer of wind-resistant asphalt shingles said the oil needed to make the shingles comes from Canada, which is the only source because US oil is too rich. The new tariffs on Canadian energy product imports have generally been less punitive than on other products. Energy products from Canada and Mexico not included in the US-Mexico-Canada Agreement are subject to a 10% tariff. Some industry insiders noted that, where possible, contractors may pivot to US-made products that contain US-derived raw materials. However, a scramble for domestically produced materials could result in shortages.

• Widespread tariffs announced by the Trump administration in early April are expected to increase construction costs and possibly lead to project cancelations, according to Construction Dive. Some key inputs are exempted from the reciprocal tariffs announced on April 2, 2025, including lumber, steel, aluminum, and copper. However, on March 12, a 25% tariff on all steel and aluminum imports went into effect. Canadian softwood lumber imports are subject to a 14.5% anti-subsidy and anti-dumping duty. Some construction industry insiders suggest that gaining complete visibility into supply chains to assess tariff implications accurately won’t be easy. Uncertainties brought on by tariffs could slow or stop new project investments, although projects already underway are likely to stay on track.
• US spending for highway and street construction in 2025 is expected to grow by about 3%, according to FMI’s first-quarter 2025 North American Engineering and Construction Outlook. While funding from the Infrastructure Investment & Jobs Act (IIJA) for programmed highway projects is scheduled to expire in 2026, FMI expects another round of fresh funding as temporary and grant projects are either extended or made permanent. Highway and street spending is forecast to rise 2% in 2026, 3% in 2027, and 5% in 2028.