Malaysia’s construction sector is contending with a broad-based rise in building material costs, with official data from the Department of Statistics Malaysia (DOSM) revealing that sand prices posted the sharpest monthly gains in July 2026 — surging as high as 14.9% month-on-month in certain states — while steel and cement indexes also edged higher across most regions.
Sand Price Index Records the Steepest Monthly Climb, Leading a Broad Advance in Construction Input Costs
The unit price index of sand increased between 0.1% and 14.9% nationwide in July 2026 compared to the previous month, according to DOSM’s official release dated August 10, 2026. The sharpest increase was recorded simultaneously in Terengganu and Kelantan, both registering a 14.9% month-on-month rise — a figure that stands out markedly against the more modest gains observed elsewhere.
Other regions also posted sand price increases, though at considerably lower magnitudes. Kota Kinabalu in Sabah recorded a 4.1% rise, while Penang, Kedah, and Perlis collectively saw a 2.8% increase over the same period. The breadth of the advance — spanning Peninsular Malaysia, Sabah, and Sarawak — indicates that supply-side pressures on this critical construction aggregate are not confined to any single geography.
Steel and Cement Price Indexes Edge Higher Month-on-Month, with Perak Registering the Largest Gains in Both Categories
Steel and cement prices moved in the same upward direction as sand in July 2026, though with considerably less intensity. The unit price index of steel rose between 0.6% and 0.9% month-on-month, with Perak recording the highest increase at 0.9%, followed by Tawau, Sabah (0.7%) and Sandakan, Sabah (0.6%).
The cement price index registered a slight increase ranging from 0.2% to 0.8% month-on-month across all surveyed areas in Peninsular Malaysia, Sabah, and Sarawak. Once again, Perak led with a 0.8% gain. Selangor, Kuala Lumpur, Melaka, and Negeri Sembilan each recorded a 0.3% rise, while Penang, Kedah, and Perlis posted a 0.2% increase.
On a year-on-year basis, the steel price index recorded increases ranging from 0.5% to 8.4% across most areas of Peninsular Malaysia, Sabah, and Sarawak. Perak again posted the highest annual gain at 8.4%, followed by Johor at 6.3% and Pahang at 4.8%. For cement, year-on-year increases ranged from 0.9% to 7.5%, with Perak recording 7.5% and Kuching and Miri in Sarawak each registering 7.2%.
Average Steel Unit Price Dips Marginally to RM3,499.50 per Metric Tonne, Even as the Price Index Trends Higher
Despite the upward movement in the steel price index, the average per-unit price of steel — comprising mild steel round bars and Mycon 60 high-tensile deformed bars — recorded a slight decrease of 0.2% month-on-month in July 2026. The average price stood at RM3,499.50 per metric tonne, compared with RM3,507.10 per metric tonne in June 2026.
This marginal decline in the average unit price, occurring alongside a rising price index, reflects compositional or regional weighting differences in how DOSM calculates each measure, and does not contradict the broader inflationary trend observed across construction inputs.
The average price of Ordinary Portland Cement remained flat at RM25.70 per 50-kilogramme bag, unchanged from the prior month — providing one point of stability within an otherwise upward-moving cost environment.
Building Material Cost Index Diverges by Region, with Sarawak Rising and Sabah Posting a Slight Decline
The Building Material Cost Index (BCI) incorporating steel bars — segmented by building category and region — presented a mixed but predominantly upward picture for July 2026. In Peninsular Malaysia, the BCI with steel bars rose between 0.1% and 1.4% month-on-month across all building categories.
Sarawak recorded an increase of between 0.2% and 1.3% month-on-month across all building categories, reflecting the cost pressures also visible in its cement price index. Sabah, by contrast, was the exception: the BCI with steel bars in Sabah declined between 0.2% and 0.5% month-on-month for all building categories in July 2026 — the only major region to post a net decrease in this composite measure.
The regional divergence within the BCI data underscores that while national-level construction cost pressures are clearly tilted to the upside, localised supply and demand dynamics — including proximity to raw material sources and logistics costs — continue to produce differentiated outcomes across Malaysia’s geographically diverse construction markets.
The DOSM data was released on August 10, 2026, and is based on the department’s ongoing monthly tracking of construction material prices across Peninsular Malaysia, Sabah, and Sarawak. — Reporting based on Bernama/DOSM data
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