Construction continues to be a bright spot for both the US economy and procurement of commodities metals.
The Architecture Billings Index, an indicator of US non-residential building activity, rose in September due to an increase in demand for institutional projects. The index rose to 55.2 last month from 53.0 in August, the American Institute of Architects (AIA) said last week. Any number above 50 reflects an increase in billings for architectural services which usually have about a one-year lag when it comes to construction stars.
While we have, at times, had reservations about the ABI’s significance of actual construction spending, there is no denying its place as an indicator of strong future non-residential construction starts, just the same as the MMI reflects actual purchase and procurement of construction metals.
The monthly Construction MMI® registered a value of 89 in November, an increase of 2.3% from 87 in October.
Overall construction spending, however, dropped 0.4% in September compared to August when spending fell 0.5%, the Commerce Department recently reported. The labor market for construction is still tight and projects are increasingly being scrutinized as clients are demanding more efficiency in procurement from architects, engineers and construction professionals so, while construction is growing, lending is scarce, good labor is still hard to come by and the overall recovery in the sector is weak.
For more information on how you should react based on the markets for construction metals and when is the right time to start buying them, take a look at MetalMiner forecasting.
After dropping the previous month, the price of European 1050 aluminum prices rose 5.5% to $3,156 per metric ton. The price of Chinese rebar rose 2.4% to $493.34 per metric ton after falling the previous month.
The price of US shredded scrap fell 8.1% to $350.00 per short ton. Following a 6.2% decline, the weekly US Gulf Coast bar fuel surcharge reached $0.46 per mile. The weekly US Rocky Mountain bar fuel surcharge closed the month at $0.50 per mile after dropping 3.6%. At $0.48 per mile, the weekly US Midwest bar fuel surcharge was down 2.8%.
The Chinese low price of 62% Australian iron ore fines remained essentially flat for the month at $157.94 per dry metric ton. Chinese aluminum bar experienced a flat month, staying around $2,312 per metric ton. Chinese H-beam steel held pat last month at $499.86 per metric ton.
The Construction MMI® collects and weights 9 metal price points used within the construction industry to provide a unique view into construction industry price trends over a 30-day period. For more information on the Construction MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.