Construction materials: a discordant situation, reflecting the political climate

Economic indicators, meanwhile, fluctuate between a wait-and-see approach and a recovery. The construction market in both the residential and non-residential sectors continues to rebound, while public works projects are experiencing a significant slowdown due to anticipated budget cuts and the upcoming elections in March 2026. Construction materials, for their part, are very gradually emerging from their sluggishness, though without yet showing a clear recovery. For aggregates and ready-mix concrete, as for many other materials in the mineral sector, the trend in activity over the past twelve months remains negative, despite a slight upturn during the last months of summer.

Key figures

Between the second and third quarters of 2025, activity recovered: +0,8% for aggregates and +1,4% for ready-mix concrete (in volume, seasonally adjusted data).

September continues the trend

After two consecutive increases in July and August, September appears more nuanced, while still confirming the recovery trend in materials. Indeed, according to the initial monthly results, aggregate production showed only slight growth compared to August (+0,4%, seasonally adjusted data), remaining 1,4% below its level last year. In the third quarter, activity thus showed a slight increase compared to the previous quarter (+0,8%), leaving production volumes 2,1% below those of a year ago. From January to September, aggregate activity was virtually stable year-on-year (-0,2%), as was its cumulative performance over the last twelve months (+0,1%). As for ready-mix concrete, after two months of increases, deliveries declined between August and September (-4,1%, seasonally adjusted data), but the year-on-year decline moderated. It reached -2,2% in September 2025, compared to -11,9% a year earlier. In the third quarter of 2025, ready-mix concrete production increased by 1,4% compared to the previous quarter but still fell by 3,3% year-on-year. Down 4,6% cumulatively over twelve months, the contraction in ready-mix concrete deliveries was -3,7% over the first nine months of 2025. The downward trend in ready-mix concrete activity thus moderated over the months, but not enough to "save" the year. In August, the materials indicator (83,8) remained almost stable at its July level, the highest point of 2025 (-0,1%, seasonally adjusted data), but it remains 0,9% lower than the August 2024 index. However, on a quarterly basis, the index increased by 1% but remains down 1% year-on-year. As with aggregates and ready-mix concrete, the downward trend is easing: cumulatively over the first eight months of the year, the decline reached -1,3%, a less negative rate than over the past twelve months (-2%). The recovery is also much more pronounced for certain materials that make up the index basket, such as tiles and bricks or cut stone, which have returned to positive trends.

Building: still some positive signs

In INSEE's latest monthly survey of building professionals, the business climate declined in October. However, analysis by sector suggests that the balance of opinion regarding housing construction rebounded after two months of decline, unlike that of maintenance and improvement, which contracted. The outlook for activity in the residential sector is more positive, although the order book for structural work remains relatively unchanged (8,8 months). The latest construction figures remain encouraging.

On the housing side, housing starts fell by 8,9% between August and September (seasonally adjusted data) but the momentum of the third quarter remains strong (+15,1% compared to the previous quarter and +19,6% year-on-year). With 272.200 units started over twelve months to the end of September (of which more than 36% are houses), the year-on-year trend remains upward (+4%). However, it masks a gap between individual housing, where construction starts are still declining slightly (-0,8%), and collective housing, which is increasing (+7,6%). This contrast should gradually disappear given the continued rise in individual permits: authorizations in the last three months climbed by +21,4% year-on-year and +4,5% quarter-on-quarter (CVS-CJO), a pace which is admittedly moderating a little. Over the course of a year, 130.000 permits were issued, which is 7,7% more than the previous twelve months. In the collective, although slightly down between the second and third quarters (-3,2%), authorizations are more than 29% higher than a year ago. Thus, 242.700 permits were filed cumulatively over twelve months to the end of September, representing almost 11% more than a year ago. In the non-residential segment, the areas started recovered by 13,8% year-on-year in the third quarter but remain on a negative trend of -1,7% cumulatively over twelve rolling months to the end of September (20,521 million m²). During this quarter, the trade, agriculture, office and public services segments proved to be the most robust. On the permit side, the surface area increased by 3,5% year-on-year during the quarter and by +3,1% cumulatively over twelve rolling months. It is still in the trade, agriculture and public services segments that the increase (in double digits) is most marked. However, all these developments, promising and sometimes vigorous, are based on initially low levels of activity. Indeed, having fallen very low, the real estate market is recovering very gradually from the crisis. And timing differences, as well as implementation delays, may explain why the effects are still slow to be reflected in the activity of the materials. The revival of the detached house is confirmed: in a context where credit conditions remain attractive and the rise in loan rates is controlled (3,14% in October compared to 3,08% on average over the previous seven months*) sales by builders accelerated further in September and increased by nearly 34% year-on-year according to Markemétron. But the market is still 50% below its long-term average! Property developers, surveyed by INSEE in October, are slightly less pessimistic about the demand for new housing and future construction starts, particularly for housing intended for social rental housing. The balance of opinion on their business prospects shows a rebound but remains below the long-term average. The figures for the marketing of new housing in the third quarter published by the ministry (SDES) remain very hesitant. Certainly, the number of homes sold in bulk has increased significantly (+12,4% over the quarter and +16,3% over a year, seasonally adjusted for a total of 15.180 reservations), particularly among social landlords (83% of the total). But sales to individuals are faltering, registering +0,4% compared to the second quarter (16.240 units) and -9,5% year-on-year. However, the supply from developers continues to recover (+5,9% and +41,9% respectively) while cancellations of reservations by buyers are falling significantly (-21% year-on-year). The collapse in sales to individual investors since the end of the Pinel scheme (-55,3% year-on-year in the third quarter according to the FPI) is still weighing on the sector's ability to recover.

TP: Activity has plateaued

According to the latest surveys by the FNTP (National Federation of Public Works), even though activity was almost stable in September (-0,8% month-on-month and -0,6% year-on-year, seasonally adjusted data), it began to decline in the third quarter (-2,6% year-on-year). This shift seems to mark the beginning of a more sustained downturn, with companies being less optimistic for the next three months despite order books being considered less depleted in October than in July, particularly among private clients. The degree of economic uncertainty is increasing, and the proportion of companies facing demand constraints (50% compared to 37% in July) has reached a high not seen since 2016—a figure undoubtedly linked to the lack of political and budgetary clarity which, with the approach of elections, is discouraging local authorities from investing.

*Source: Housing Credit Observatory – fixed-rate loans in the competitive sector

Illustrative image of the article via Depositphotos.com.