---
title: "ICBA ECONOBOT: Producer Prices Keep Climbing as Costs Squeeze Builders"
description: Producer prices in Canada continue to climb, squeezing builders as raw material costs surge, impacting the construction industry and small businesses.
---

[Economics Blog ](https://icba.ca/economics-blog)

# [ICBA ECONOBOT: Producer Prices Keep Climbing as Costs Squeeze Builders](https://icba.ca/economics-blog/icba-econobot-producer-prices-keep-climbing-as-costs-squeeze-builders)

 Written by [Jordan Bateman](https://icba.ca/economics-blog/author/jordan) | Jun 18, 2026 4:52:39 PM

**TOP STORY**

**Producer Prices Keep Climbing — The Cost Squeeze Hitting Contractors Before It Hits the Headlines**

Industrial product and raw material prices in Canada rose another 1.2% in May and are now up 13.6% year over year — the 20th straight month of annual gains, [Statistics Canada reported Thursday](https://www150.statcan.gc.ca/n1/daily-quotidien/260618/dq260618a-eng.htm?utm_source=hs_email&utm_medium=email&_hsenc=p2ANqtz-8EBKmPfFfBe-rdK521o-HaKZtIMYm8NbWzOYpuoRhPvM1Wnpy19gccjx4Tw0bqyLYOR46J). The raw-materials index is up a staggering 33.4% over the year. For anyone pouring concrete or framing in BC or Alberta, the detail is what stings: plastic resins jumped 33.1% in May, petrochemicals 17.0%, aluminum 3.5% and copper 4.5%, while diesel is up 61% year over year. Ongoing disruption through the Strait of Hormuz continues to ripple through energy and chemical supply chains. StatCan notes its producer index excludes the direct hit from tariffs — meaning the real input-cost pressure on builders is worse than these numbers show.

 

**THE NUMBERS — STATISTICS CANADA**

**Industrial & Raw Materials Prices, May 2026** — IPPI +1.2% month over month (fifth straight increase), +13.6% year over year; RMPI +0.7% m/m, +33.4% y/y. Chemicals (+7.0%), energy and petroleum (+2.5%) and non-ferrous metals led the gains. [Statistics Canada](https://www150.statcan.gc.ca/n1/daily-quotidien/260618/dq260618a-eng.htm?utm_source=hs_email&utm_medium=email&_hsenc=p2ANqtz-8EBKmPfFfBe-rdK521o-HaKZtIMYm8NbWzOYpuoRhPvM1Wnpy19gccjx4Tw0bqyLYOR46J)

**Farm Sector Balance Sheet, 2025** — National farm equity rose 6.5% to $888.9 billion. The West drove it: Alberta equity climbed 11.6% and Saskatchewan 9.9%, together more than three-quarters of the national gain. BC was the lone province to slip, down 1.7%. [Statistics Canada](https://www150.statcan.gc.ca/n1/daily-quotidien/260618/dq260618c-eng.htm?utm_source=hs_email&utm_medium=email&_hsenc=p2ANqtz-8EBKmPfFfBe-rdK521o-HaKZtIMYm8NbWzOYpuoRhPvM1Wnpy19gccjx4Tw0bqyLYOR46J)

 

**WORTH WATCHING**

**May CPI — Monday, June 22** — With energy and producer prices running hot, watch whether the pass-through finally shows up at the consumer level. April CPI was already at 2.8%. A hot print further dims any hope of a summer rate cut.

**Next Producer Price Read — July 24** — June IPPI/RMPI will show whether five straight monthly increases turn into six.

 

**IN BRIEF**

**ICBA Economics** — [Canada's "entrepreneurial drought" is a warning sign.](https://icba.ca/economics-blog/blog-tracking-business-dynamics?province=BC&utm_source=hs_email&utm_medium=email&_hsenc=p2ANqtz-8EBKmPfFfBe-rdK521o-HaKZtIMYm8NbWzOYpuoRhPvM1Wnpy19gccjx4Tw0bqyLYOR46J) ICBA Chief Economist Jock Finlayson flags CFIB data showing business closings have outpaced start-ups nationally since early 2024, with B.C.'s net business formation decelerating sharply over the past two years. It matters for our members: construction is a hot-bed of entrepreneurship, where the vast majority of B.C. and Alberta firms are micro (1–4 employees) or small (5–99) — exactly the businesses a high-cost, high-tax environment squeezes first.

**Statistics Canada** — [Small businesses bracing for higher costs.](https://www150.statcan.gc.ca/n1/pub/11-621-m/11-621-m2026008-eng.htm?utm_source=hs_email&utm_medium=email&_hsenc=p2ANqtz-8EBKmPfFfBe-rdK521o-HaKZtIMYm8NbWzOYpuoRhPvM1Wnpy19gccjx4Tw0bqyLYOR46J) Nearly two-thirds (64%) of firms with 1–19 employees — the heart of the contracting sector — expect cost obstacles in the coming months, naming inflation (48.7%), input costs (27.1%) and transportation (26.0%) as the top three. More than a third expect lower profitability, and just 65% are optimistic about the year ahead, versus 80% of large firms.

[View full post](https://icba.ca/economics-blog/icba-econobot-producer-prices-keep-climbing-as-costs-squeeze-builders)

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