Source: Jeff Yoders/MetalMiner
Construction materials prices were down 3.6% from the same time last year. Data from the Department of Labor showed that there was a 2.1% fall from December to January, and a 4.6% decline on a yearly basis for nonresidential construction.
The overall producer price index dipped in January. Some material prices did, however, rise last month.
The decline in oil and petroleum prices finally showed up in the Producer Price Index data, according to Associated Builders and Contractors Chief Economist Anirban Basu.
“According to the Bureau of Labor Statistics crude petroleum prices fell 30.6% for the month and 54.8% for the year but other input categories also experienced downward pressure, including non-ferrous wire and cable and softwood lumber,” Basu said.
“There are reasons to believe that prices will continue to be suppressed by a host of factors, including a strong US dollar, the lack of supply response to the significant price declines and ongoing weakness in Europe, which is translating into low interest rates throughout the advanced world,” Basu said. “In general, falling input prices are good for contractors since they tend to bolster margins, increase the likelihood that certain construction projects will move forward, and allow the Federal Reserve to maintain its accommodative monetary stance. For contractors who are involved in oil exploration and mining activities, the news is not nearly as positive.”
The following materials prices increased in January:
- Prices for plumbing fixtures expanded 0.8% in January and are up 3.9% on a year-over-year basis.
- Concrete products prices expanded 0.5% in January and are up 4.8% on a yearly basis.
- Prices for prepared asphalt, tar roofing and siding gained 2.7% for the month and are up 4.2% on a year-ago basis.
Eight of the 11 key construction inputs did not expand for the month.
- Iron and steel prices fell 0.6% in January and are down 6.7% from the same time last year.
- Fabricated structural metal product prices remained flat for the month and have expanded 1.2% on a year-over-year basis.
- Non-ferrous wire and cable prices fell 3.3% on a monthly basis and 6.4% on a yearly basis
- Steel mill products prices fell 1.2 percent for the month and are 1.5% lower than one year ago.
- Softwood lumber prices fell 1.5% and are 0.6% lower than one year ago.
Crude petroleum prices fell 30.6% in January and are down 54.8% from the same time last year. Crude energy materials prices fell 23.6% in January and are 38.4% lower year over year. Natural gas prices fell 28.9% in January and are down 29.3% from one year ago.