Johannesburg, 23 June 2026 – The findings of the Afrimat Construction Index (ACI) for the first quarter of 2026 have been released, showing a marginal year-on-year increase of 0.3%. Notably, though, the ACI was boosted by year-on-year increases of more than 5% in the value of both construction works and buildings completed, whilst employment and sales of building materials also improved.
This composite index of activity levels in the building and construction sectors is compiled every quarter by economist Dr Roelof Botha on behalf of Afrimat. The index value is expressed in real terms, i.e., after adjustment for the effect of inflation.
According to Dr Botha, although activity levels in South Africa’s construction sector remain subdued, the ACI’s seasonally adjusted reading has increased for the third consecutive quarter, the first time this has occurred since the brief recession of 2020.
“The most impressive aspect of the latest ACI reading is the stability that has crept in for two key indicators – the value of non-residential buildings completed, and the value of construction works.”
He added that it is also encouraging that employment levels in the construction sector have managed to outperform job creation in most other sectors, with 74,000 more jobs in the first quarter of 2026 than a year ago.
“Despite the combined value of construction works and buildings only accounting for 5.5% of total value added in the economy, the construction sector was responsible for 11% of the new jobs created in the first quarter of 2026 year-on-year.”
As was the case in the previous quarter, five of the 10 indicators recorded positive year-on-year growth rates, whilst one remained unchanged and three of the other four recorded declines of less than 2% year-on-year.
“Lower interest rates have played an important role in lowering the cost of capital formation, and the peace accord between the US and Iran may lead to a resumption of the rate-cutting cycle during the second half of the year,” said Botha.
The following table shows the quarter-on-quarter and year-on-year percentage changes for the 10 constituent indicators included in the ACI.
According to Botha, it is encouraging that the total construction tender activity during February and March experienced two consecutive months of double-digit increases. According to a report published by Industry Insights, overall construction tender activity in South Africa increased by 11.4% year-on-year in the first four months of 2026. KwaZulu-Natal, the Eastern Cape, and the North-West have shown notable increases thus far in 2026.
He added that during the first quarter of this year, the macroeconomy also received a welcome boost in the form of a 1.4% year-on-year increase in gross domestic product (GDP), with investor sentiment improving as a result of a strong currency and upgrades by international ratings agencies for the outlook of South Africa’s sovereign debt.
Looking ahead, Botha is hopeful that the reopening of the Strait of Hormuz in the Middle East will lead to lower inflation and a resumption of the Reserve Bank’s rate-cutting cycle. “A lowering of the prime rate will go a long way to restoring profitability in the construction sector, which is sensitive to the cost of capital – especially in residential construction.”
Commenting on the latest ACI results, Andries van Heerden, CEO of Afrimat, said that the Group is serious about building a sustainable and enduring South African company that will continue to support the bedrock of the local economy, with a focus on construction materials and bulk commodities. Both of these involve open-pit mining, the core of Afrimat’s operations.
“Our renewed focus on aggregate quarrying has proven to be well-timed, not only as a significant contributor to the FY2026 results, but also as reflected in the results of the ACI.”
Afrimat recently announced the completion of the disposal of certain aggregate quarries and readymix concrete plants across South Africa as part of its acquisition of Lafarge South Africa Holdings. The total purchase consideration is R215 million, comprising R160 million in cash payable on 1 July 2026 and R55 million deferred over three years, subject to conditions. “The cash received will be used to reduce debt,” van Heerden said.
As he previously noted, the sheer volume of projects successfully executed across the country clearly demonstrates Afrimat’s capacity for steady, sustainable growth. “In the Eastern Free State, Afrimat actively drove the supply of aggregates to a major hydro project. Meanwhile, in the Western Cape, the Group spearheaded the delivery of readymix concrete to both a wastewater treatment plant and the Devonbosch Lifestyle Estate in Stellenbosch.”
Across KwaZulu-Natal, Afrimat actively deployed its specialised concrete solutions, technical expertise, and piling solutions to a woodchip plant, a fire water reservoir, and a biomass plant. Furthermore, the Group successfully fulfilled the requirements for aggregates and gravel products on a provincial road and a separate road rehabilitation project within that same province.
In Gauteng, Afrimat managed the provision of aggregates and precision-mixed concrete for a mall and a container yard, while in Lephalale, the Group successfully executed the supply of crushed aggregates and readymix concrete to a solar project.
“A consistent, steady supply of construction materials is keeping quarries across our South African footprint busy.”
Van Heerden concluded by saying, “The recent approval by the National Energy Regulator of South Africa of a reduced electricity tariff for the ferrochrome industry is good news for South Africa and for the preservation of jobs. It also that our Nkomati Anthracite Mine is ramping up to full production over the next six months.”
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Issued for: Afrimat Limited
- Contact: Andries van Heerden, Chief Executive Officer (CEO)
- Tel: 021-917-8853
- Email: andries@afrimat.co.za
- Website: www.afrimat.co.za
- Issued by: Keyter Rech Investor Solutions
- Contact: Vanessa Rech
- Tel: 083-307-5600
- Email: vrech@kris.co.za