Tag Archive for 'construction materials'

ABC Reports: Construction Materials Prices Expand in March

CEU2“Although overall construction materials prices rose for the month, prices for more categories of materials decreased than increased” —ABC Chief Economist Anirban Basu.

PPI_Mar15Prices for inputs to construction industries expanded 0.8 percent in March, the largest monthly increase in more than two years, according to the April 14 producer price index release by the Bureau of Labor Statistics. Prices have now expanded for two consecutive months after declining during the prior six; however input prices are down 3.6 percent on a year-over-year basis. March marks the fourth consecutive month year-over-year input prices have declined, the longest such streak since 2009. Crude petroleum prices fell 4 percent in March and have fallen in eight of the previous nine months.

“Although overall construction materials prices rose for the month, prices for more categories of materials decreased than increased, including sharp monthly declines in the price for softwood lumber and iron/steel,” said Associated Builders and Contractors Chief Economist Anirban Basu. “On a year-over-year basis, deflationary pressures are even more apparent as crude petroleum prices are down 55 percent and natural gas is down 45 percent, despite an increase in gas prices in March.

“Though U.S. nonresidential and residential segments continue to expand, global construction volumes remain suppressed by widespread weakness in Asia, Europe and Latin America,” said Basu. “With the U.S. dollar likely to get stronger over the next few months as domestic interest rates begin to rise, there is little likelihood of significant increases in construction input prices over the next six to nine months. Overall producer prices managed to increase 0.5 percent on a monthly basis, the first increase since June 2014. This reading serves to increase the likelihood that the Federal Reserve will begin to increase short-term interest rates later this year.”

Only two of the key materials prices increased in March.

  • Fabricated structural metal product prices inched 0.4 percent higher for the month and have expanded 1.3 percent on a year-over-year basis.
  • Natural gas prices expanded 1.5 percent in March, but are down 45.3 percent from the same time one year ago.

Nine of the 11 key construction inputs did not expand for the month.

  • Prices for plumbing fixtures fell 0.3 percent in March but are up 2.5 percent on a year-over-year basis.
  • Prices for prepared asphalt, tar roofing, and siding fell 0.4 percent for the month and are down 0.2 percent on a year-ago basis.
  • Iron and steel prices fell 2.5 percent in March and are down 11.5 percent from the same time last year.
  • Steel mill products prices fell 1.9 percent for the month and are 4.8 percent lower than one year ago.
  • Softwood lumber prices fell 4.1 percent and are 7.4 percent lower than one year ago.
  • Nonferrous wire and cable prices remained flat on a monthly basis and grew 2.5 percent on a yearly basis
  • Crude petroleum Crude energy prices fell 4 percent in March and are down 55 percent from the same time last year.
  • Crude energy materials prices fell 1.4 percent in March but are 43.7 percent lower year over year.
  • Concrete products prices remained flat in March and are up 4.1 percent on a yearly basis.

To view the previous PPI report, click here

ABC Reports: Construction Materials Prices Dip in December

CEU2“The U.S. economy has performed handsomely over the past nine months, according to most metrics, and conventional wisdom suggests that it can continue to expand at or above trend rates of growth.”—ABC Chief Economist Anirban Basu

PPI December 20142Construction input prices dipped 1.4 percent during the final month of 2014 and are down nearly 1 percent on a year-over-year basis, according to the Jan. 15 producer price index release from the U.S. Department of Labor. Inputs to nonresidential construction fell even farther, down 1.7 percent for the month and 1.9 percent year over year. December’s report marks the sharpest decline in input prices since late 2008 during the global financial crisis and the fifth consecutive month construction materials prices have failed to rise.

“Without question, financial markets have been unnerved by the recent declines in oil, copper and other commodity prices, although that jitteriness does not necessarily imply a serious economic problem in America,” said Associated Builders and Contractors Chief Economist Anirban Basu. “The fact is the U.S. economy has performed handsomely over the past nine months, according to most metrics, and conventional wisdom suggests that it can continue to expand at or above trend rates of growth despite economic weakening in Europe, China and elsewhere. This is further evidenced by the World Bank’s recent downgrade of its forecasts for global growth in 2015 and 2016, while it upgraded its outlook for the United States.

“Overall, the view that U.S. domestic demand for construction services and most other services continues to expand is consistent with the fact that some domestically produced and consumed materials actually registered price increases last month,” said Basu. “Note that concrete prices are up by 5 percent on a year-over-year basis while natural gas prices are up by 10 percent.”

The following materials prices increased in December.

  • Prices for plumbing fixtures expanded 0.1 percent in December and are up 3.1 percent on a year-over-year basis.
  • Concrete products prices expanded 0.7 percent in December and are up 5 percent on a yearly basis.
  • Natural gas prices expanded 19.7 percent in December and are 10 percent higher than one year ago.
  • Fabricated structural metal product prices grew 0.3 for the month and have expanded 1.5 percent on a year-over-year basis.

Seven of the 11 key construction inputs did not experience price increases for the month.

  • Iron and steel prices fell 1 percent in December and are down 3.9 percent from the same time last year.
  • Nonferrous wire and cable prices fell 1.6 percent on a monthly basis and 1.5 percent on a yearly basis.
  • Prices for prepared asphalt, tar roofing, and siding fell 1 percent for the month but are up 1.9 percent on a year-ago basis.
  • Steel mill products prices fell 1.3 percent for the month but are 0.4 percent higher than one year ago.
  • Softwood lumber prices fell 1.3 percent in December but are 0.3 percent higher than one year ago.
  • Crude petroleum prices fell 18.9 percent in December and are down 37.1 percent from the same time last year.
  • Crude energy materials prices fell 4.7 percent in December but are 19.6 percent lower year-over-year.

To view the previous PPI report, click here.

ABC Reports: Construction Materials Prices Inch Down in September

CEU2“The decline in oil prices has been simply stunning and is largely in response to growing evidence of weakness in Europe.”—ABC Chief Economist Anirban Basu.

PPI_10 15 2014Construction materials prices inched down 0.1 in September, but rose 1.6 percent compared to the same time last year, according to the U.S. Department of Labor’s Oct. 15 Producer Price Index. Prices for inputs to construction industries have remained unchanged from June to August—the longest such period since the price index for construction inputs began in 1986. Inputs to nonresidential construction fell 0.2 percent for the month, but were 1 percent higher than in September 2013.

Crude energy materials prices declined 1 percent in September and are 7.9 percent lower than one year ago. Natural gas prices climbed 4 percent in September after decreasing in the three previous months. However, on a year-over-year basis, natural gas prices have expanded for 22 consecutive months.

“The decline in oil prices has been simply stunning and is largely in response to growing evidence of weakness in Europe,” said Associated Builders and Contractors Chief Economist Anirban Basu. “Forecasts of European economic performance are seemingly being downgraded on a daily basis, including forecasts of Germany’s economy, which heretofore has been a reasonably strong performer.”

“Without the decline in oil prices, which could fall even further looking ahead, materials prices in the aggregate would not have decreased in September,” said Basu. “In fact, a number of materials prices actually rose during the month, including iron and steel (0.5 percent) and softwood lumber (2.7 percent). Stakeholders also should note that the U.S. dollar has been rising for much of 2014, which has a tendency to suppress materials price increases.”

The following materials prices increased in September.

  • Softwood lumber prices expanded 2.7 percent and are 10.2 percent higher than one year ago.
  • Prices for plumbing fixtures expanded 0.1 percent in September and are up 3.1 percent on a year-over-year basis.
  • Steel mill products prices rose 0.1 percent for the month and are 4.7 percent higher than one year ago.
  • Nonferrous wire and cable prices grew 0.1 percent on a monthly basis, but are unchanged from one year ago.
  • Prices for prepared asphalt, tar roofing, and siding expanded 0.2 percent for the month, but are down 9.8 percent on a year-ago basis.
  • Iron and steel prices expanded 0.5 percent in September and are up 4.6 percent from the same time last year.
  • Natural gas prices expanded 4 percent in September and are 9.9 percent higher than one year ago.

Four of the 11 key construction inputs did not experience price increases for the month.

  • Concrete products prices fell 0.3 percent in September, but are up 3.6 percent on a year-over-year basis.
  • Fabricated structural metal products remained flat for the month and have expanded 1.9 percent on a year-over-year basis.
  • Crude petroleum prices fell 3.9 percent in September and are down 15.5 percent from the same time last year.
  • Crude energy materials prices fell 1 percent in September and are 7.9 percent lower year over year.

To view the previous Producer Prices Index report, click here

ABC Reports: Construction Materials Prices Up 0.5 Percent in March

CEU2“Despite the increase in materials prices, this report does not signal a period of much higher inflation.” —ABC Chief Economist Anirban Basu.

PPI_4 11 14Construction materials prices expanded 0.5 percent in March and are up 1.1 percent from March of last year, according to the U.S. Department of Labor’s April 11 producer price index release. Nonresidential construction materials prices are up 0.4 percent for the month and are 1 percent higher than the same time one year ago.

“Despite the increase in materials prices, this report does not signal a period of much higher inflation,” said Associated Builders and Contractors Chief Economist Anirban Basu. “While it is true that there were significant increases in overall monthly inflation for both the broader economy and for construction, only a handful of categories were actually associated with a meaningful uptick in prices.”

Overall, the nation’s wholesale goods prices fell 0.1 percent in March but are up 1.7 percent year over year. Crude energy materials prices fell 6.8 percent in March but are still 13.6 percent higher than one year ago, and have expanded by 34.1 percent through the first three months of 2014.

“With respect to the broader economy, much of the inflation was related to food, which likely is a result of meteorological impacts,” said Basu. “With respect to construction, only three of 11 categories actually experienced increasing prices for the month. Given modest projections for both global and national economic growth, it is unlikely that significant inflationary pressures will be experienced during the month ahead with respect to most construction materials prices.”

The following materials prices increased in March.

Nonferrous wire and cable prices gained 0.1 percent in March but are down 2.7 percent from one year ago.

Concrete products prices expanded 0.3 percent in March and are up 3.9 percent from one year ago.

Prices for prepared asphalt, tar roofing, and siding expanded by 1.1 percent for the month and are up 0.1 percent from one year ago.

Eight of the 11 key construction inputs did not experience price increases for the month.

Iron and steel prices fell 1.7 percent in March but are up 1.3 percent from the same time last year.

Natural gas prices fell 10.9 percent in March but are 48.5 percent higher than one year ago.

Crude energy prices fell 6.8 percent in March but are 13.6 percent higher than one year ago.

Steel mill products prices shed 1.1 percent for the month but are 1.4 percent higher than one year ago.

Crude petroleum prices fell 6.4 percent in March but are up 3.9 percent from March 2013.

Prices for plumbing fixtures shed 0.8 percent for the month but are up 1.9 percent from the same time last year.

Fabricated structural metal product prices are down 0.2 percent for the month but have risen 0.5 percent from one year ago.

Softwood lumber prices fell 0.8 percent in March and are 2.1 percent lower than one year ago.

To view the previous PPI report, click HERE

Construction Materials Prices Rise Only 0.1 Percent In December

CEU2“Materials prices continue to be unusually well behaved, neither rising nor falling aggressively on a month-to-month basis.” —ABC Chief Economist Anirban Basu.

PPI_JanuaryConstruction materials prices expanded just 0.1 percent in December and are up 1.3 percent year over year, according to a Jan. 15 Producer Price Index released by the Department of Labor. Nonresidential construction materials prices also rose only 0.1 percent for the month and are 1 percent higher than the same time one year ago.

“Materials prices continue to be unusually well behaved, neither rising nor falling aggressively on a month-to-month basis,” said Associated Builders and Contractors Chief Economist Anirban Basu. “That said, there was some volatility in individual input segments, including natural gas prices, which were up 7.8 percent, and crude petroleum, which was up 7.1 percent,” Basu said. “These increases are at least partially explained by seasonal factors and do not likely foreshadow aggressive price increases going forward. At the same time, certain input prices fell, including softwood lumber, down 3.3 percent, and nonferrous wire/cable, down 1.4 percent.”

Overall, the nation’s wholesale goods prices expanded 0.4 percent in December and are up 1.2 percent year over year.

“While there is never a guarantee of input price stability, for now things seems reasonably calm,” Baus said. “The world economy is anticipated to accelerate this year to 3.6 percent growth, up from closer to 3 percent last year. That will help push the level of demand for construction materials higher, but not necessarily in ways that are especially damaging to a still-benign U.S. nonresidential construction industry outlook.”

The following materials prices increased in December:

Fabricated structural metal product prices are up 0.1 percent and have risen 0.6 percent on a year-over-year basis.

Natural gas prices rose 7.8 percent in December and are 4.9 percent higher than one year ago.

Natural gas prices rose 7.8 percent in December and are 4.9 percent higher than one year ago.

Crude energy prices grew 4.8 percent in December and are 4.4 percent higher year over year.

Iron and steel prices expanded 1.6 percent in December but are down 5.9 percent from the same time last year.

Prices for plumbing fixtures and fittings rose 0.1 percent for the month and are up 1.6 percent on a year-over-year basis.

Steel mill products prices expanded 0.3 percent for the month but are 6.3 percent lower than one year ago.

A number of key construction inputs did not experience price increases for the month:

Prices for prepared asphalt, tar roofing and siding declined 0.8 percent for the month but are up 3.6 percent from last year.

Concrete products remained flat in December but are up 2.3 percent year over year.

Nonferrous wire and cable prices shed 1.4 percent on a monthly basis and are down 3.4 percent from December 2012.

Softwood lumber prices fell 3.3 percent for the month but are 6.6 percent higher than one year ago.

To view the previous Producer Price Index report, click here.