Basic Metals Wholesale Prices Jump 9.54%, Raising Construction Costs

Nepal’s Wholesale Price Index (WPI) for July–August 2025/26 highlights a sharp surge in the Basic Metals category, which recorded a 9.54% increase compared to June–July 2025. With a significant 12.55% weight in the manufacturing group, this rise in metal prices is exerting strong upward pressure on overall wholesale inflation, especially in construction and infrastructure-related sectors.

The wholesale price index for basic metals climbed from 161.46 in July–August 2024/25 to 176.87 in July–August 2025/26, reflecting higher costs of steel, iron, and allied products. This surge comes at a time when infrastructure projects, housing demand, and industrial activity are recovering, intensifying demand for raw materials. Global commodity price fluctuations, rising import costs, and supply-chain challenges have further added to the domestic price hike.

The impact is most evident in the construction sector, where metals are a core input for buildings, bridges, and large-scale infrastructure. Contractors and builders are likely to face higher costs, which could delay projects or raise final prices for consumers. The increase also affects downstream industries such as machinery, transport equipment, and household durables, amplifying inflationary pressures beyond the construction sector.

While this rebound provides revenue relief for metal producers and traders, it poses challenges for developers, policymakers, and households planning construction. If global commodity markets remain volatile, Nepal’s reliance on imported metals may keep wholesale prices elevated in the near term.