Tag Archive for 'construction materials prices'

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 Flat in July

CEU2“The weakening of economies in Europe, Japan and elsewhere has reduced demand for construction materials on a global basis.” —ABC Chief Economist Anirban Basu.

ppi_8 15 14Overall, construction materials prices inched higher in July and are up 2 percent year over year, according to the Aug. 15 producer price index (PPI) release by the U.S. Department of Labor. Nonresidential construction materials prices were flat for the month and are just 1.4 percent higher than at the same time one year ago.

“The weakening of economies in Europe, Japan and elsewhere has reduced demand for construction materials on a global basis, helping to offset the impact of geopolitical strife in commodity-rich areas,” said Associated Builders and Contractors Chief Economist Anirban Basu. “Oil and other commodity prices have actually been falling in recent days as additional bad economic news emerges from Germany, France, Italy and other major economies.”

Crude energy materials prices fell 6.3 percent in July and are 1.7 percent lower than one year ago. Natural gas prices fell by 5.7 percent in July and have now fallen in four of the past five months on a monthly basis. On a year-over-year basis, natural gas prices have expanded by more than 10 percent for each month of 2014. Overall, the nation’s final demand prices, as measured by the PPI, expanded by 0.1 percent in July and are up 1.7 percent year over year.

“While the harsh winter helped to lift energy prices during the initial quarter of 2014, a cool and pleasant summer has helped to usher them in the opposite direction,” said Basu. “From a monetary policy perspective, the 1.7 percent year-over-year gain in overall final demand prices bodes well for those who would prefer to see the Federal Reserve continue its soft-on-inflation policymaking. During previous months, final demand price gains were in the range of 2 percent on a year-over-year basis. The July data will help to assuage inflation-related fears.”

The following materials prices increased in July.

· Softwood lumber prices expanded 3.4 percent and are 9.5 percent higher than one year ago.

· Prices for plumbing fixtures expanded 0.9 percent in July and are up 2.8 percent on a year-over-year basis.

· Concrete products prices expanded 0.4 percent in July and are up 3.6 percent on a yearly basis.

· Steel mill products prices rose 0.1 percent for the month and are 3.9 percent higher than one year ago.

· Fabricated structural metal product prices grew 0.2 for the month and have expanded 1.3 percent on a year-over-year basis.

· Nonferrous wire and cable prices grew 0.6 percent on a monthly basis, but are down 0.8 percent from July 2013.

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

· Prices for prepared asphalt, tar roofing, and siding declined 4.2 percent for the month and are down 9.1 percent on a year-ago basis.

· Iron and steel prices remained flat in July and are up 3.2 percent from the same time last year.

· Natural gas prices shed 5.7 percent in June but are 16.4 percent higher than one year ago.

· Crude petroleum prices fell 8 percent in July on both a monthly and a yearly basis.

· Crude energy materials prices fell 6.3 percent in July and are 1.7 percent lower year over year.

To view the previous PPI report, click HERE

ABC Reports: Construction Materials Prices Remain Stable In November

CEU2“November represented another month of remarkable stability for construction input prices.” —ABC Chief Economist Anirban Basu.

PPI-December_2013Overall, construction materials prices fell 0.5 percent in November and are up only 1.1 percent year over year, according to the Department of Labor’s Dec. 13 Producer Price Index. Nonresidential construction materials are down 0.6 percent for the month and are 0.7 percent lower than the same time last year.

“November represented another month of remarkable stability for construction input prices,” said Associated Builders and Contractors (ABC) Chief Economist Anirban Basu.

“Although many investors predicted significant inflation this year due to expansionary monetary policies in much of the developed world, there continues to be a lack of significant inflationary pressures both globally and nationally.”

Overall, the nation’s wholesale goods prices expanded 0.2 percent in November, but are down 0.9 percent year over year.

“Next year is unlikely to offer as much stability as 2013,” Basu said. “Global economic growth is set to accelerate and the apparent budget deal in Congress should produce greater certainty among businesses, helping improve an already benign national economic forecast. Tension in the Middle East also continues to be a consideration. Together, these factors suggest materials price increases may be at least slightly more rapid in 2014.”

The following materials prices increased in November:

•Fabricated structural metal products were up 0.1 percent for the month and 0.3 percent year over year.

•Softwood lumber prices increased 2.6 percent on a monthly basis and are up 12.8 percent year over year.

•Natural gas prices were up 1.9 percent for the month and 3.3 percent on an annual basis.

• Nonferrous wire and cable prices rose 0.2 percent on a monthly basis and are down 3 percent year over year.

•Iron and steel prices were up 1.8 percent for the month and are down 0.1 percent compared to the same time last year.

•Prices for plumbing fixtures and fittings inched up 0.1 percent in November and are up 1.6 percent year over year.

•Steel mill products prices increased 0.8 percent in November but are down 0.6 percent compared to the same time last year.

The following construction inputs experienced price decreases in November:

•Prepared asphalt, tar roofing and siding prices were down 3.8 percent for the month and 0.3 percent year over year.

•Crude petroleum prices fell 10.3 percent on a monthly basis but are up 0.9 percent year over year.

• Crude energy prices decreased 5.7 percent in November but are up 0.6 percent compared to the same time last year.

•Concrete products prices were flat in November and are up 2.8 percent year over year.

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

ABC Reports: Construction Materials Prices Fall Slightly In October

CEU2“Despite ongoing expressions of concern regarding inflation due to stimulus measures being conducted by the U.S. Federal Reserve and other major central banks around the world, the data continue to reflect remarkable stability in construction materials prices.” —ABC Chief Economist Anirban Basu.

PPI-November_2013Construction materials prices fell 0.2 percent in October and are down 0.3 percent year over year, according to the Nov. 21 Producer Price Index released by the Department of Labor. Nonresidential construction materials are down 0.5 percent for the month and are unchanged from the same time one year ago.

“We continue to observe a lack of significant inflationary pressures both globally and nationally,” said Associated Builders and Contractors Chief Economist Anirban Basu. “Despite ongoing expressions of concern regarding inflation due to stimulus measures being conducted by the U.S. Federal Reserve and other major central banks around the world, the data continue to reflect remarkable stability in construction materials prices.” ;

Overall, the nation’s wholesale goods prices expanded 1 percent in October and are up 2 percent year over year. “Inflation as measured by the Producer Price Index and other indices remains well within Federal Reserve tolerances, suggesting that the institution’s bond purchasing program is likely to remain fully intact for now,” said Basu.

“However, there is no guarantee that the stability of materials prices will persist,” Basu said. “The situation in Iran appears to be heating up and that could ultimately translate into commodity supply interruptions, boosting prices in the process. Moreover, U.S. economic growth is expected to accelerate next year, which, all things being equal, tends to push input costs higher.”

The following materials prices increased in October:

• Fabricated structural metal product prices are up 0.4 percent and have risen 0.4 percent on a year-over-year basis.

• Softwood lumber prices climbed 1.2 percent and are 16.2 percent higher than one year ago.

• Natural gas prices expanded 0.2 percent and are 15.3 percent higher than one year ago.

• Concrete products edged up 0.1 percent and are up 2.9 percent on a yearly basis.

A number of key construction inputs did not experience price increases in October.

• Nonferrous wire and cable prices fell 0.7 percent on a monthly basis and are down 3.4 percent from October 2012.

• Prices for plumbing fixtures and fittings were unchanged for the month and are up just 1.5 percent on a year-over-year basis.

• Prices for prepared asphalt, tar roofing and siding declined 1.6 percent for the month and are only 1 percent higher than a year ago.

• Iron and steel prices are unchanged on both a monthly and annual basis.

• Crude petroleum prices fell 5.2 percent for the month, but are up 7.5 percent from October 2012.

• Crude energy prices fell 3.6 percent for the month, but are 7.3 percent higher year over year.

• Steel mill products prices remained unchanged and are 2.4 percent lower than one year ago.

To view the previous Producer Price Index report, click here

ABC Reports: Construction Materials Prices Dip 0.1 Percent in June

CEU2“With the global economy beginning to tread water, the good news is materials prices are unlikely to rise significantly during the next several months.” —ABC Chief Economist Anirban Basu.

Employment-July2013.pngSummary

Construction materials prices decreased 0.1 percent in June and are virtually unchanged for the quarter, according to the July 12 Producer Price Index report by the U.S. Labor Department.

Year over year, construction materials prices are 1.5 percent higher. Nonresidential construction materials prices were unchanged in June, rose 0.1 percent for the quarter and increased 1.2 percent during the last 12 months.

Following an 8.2 percent drop in May, softwood lumber prices fell 5.6 percent in June and are down 11.2 percent for the quarter. However, they remain 8 percent higher compared to the same time last year. Iron and steel prices decreased 0.9 percent for the month, and are down 3.4 percent for the quarter and 7.2 percent on a year-over-year basis. Steel mill prices follow a similar trend: down 0.7 percent for the month, down 1.6 percent for the quarter, and 8.1 percent lower than June 2012.

Prices for concrete products, fabricated structural metal products, and plumbing fixtures and fittings were all flat for the month. Year over year, concrete product prices are up 3 percent, fabricated structural metal product prices are down 0.8 percent, and plumbing fixtures and fitting prices are up 1 percent.

Crude energy materials prices kicked off the summer with a 0.3 percent increase in June. They increased 9.2 percent for the quarter and are up 21.5 percent from one year ago. Nonferrous wire and cable price rose 0.4 percent for the month, but were down 3.9 percent overall for the quarter and are down 2.1 percent during the last 12 months. Prices for prepared asphalt, tar roofing and siding rose 1.7 percent in June, increased 5.5 percent in the second quarter, and are 3 percent higher than the same time last year.

Overall, the nation’s wholesale goods prices increased 0.8 percent in June, rose 0.6 percent during the second quarter, and are 2.5 percent higher than one year ago.

Analysis

“Today’s headline number for construction materials prices indicates little movement,” said Associated Builders and Contractors Chief Economist Anirban Basu. “But, when viewed as individual components on a monthly or quarterly perspective, there is evidence of volatility.

“This volatility has been most apparent with softwood lumber, a category in which prices fell 5.6 percent in a single month,” Basu said. “The drop is likely attributable to an increase in softwood lumber production as opposed to a decline in demand.

“Price volatility also has been apparent in recent months in crude energy categories, iron and steel, and in prepared asphalt,” added Basu.

“With the global economy beginning to tread water, the good news is materials prices are unlikely to rise significantly during the next several months,” Basu said. “However, even as global economic growth slows, equity and certain other asset prices have been on the rise due in large measure to accommodative monetary policy.

“It is always possible that investors will begin to shift greater focus toward commodities going forward, which could drive materials prices higher even in the absence of accelerating global economic growth or significant rebound in America’s nonresidential construction industry,” said Basu.

To view the previous PPI report, click here.