Fallout from the Samarco mine disaster in Brazil continues, and construction input prices are at their lowest cost, overall, since 2011.
Insurance Caps Already Exceeded
The cost of a deadly dual dam burst at an iron ore mine in Brazil run by Samarco has already exceeded the insurance cap for civil damages, co-owner Vale SA said on Monday.
Samarco, owned by Vale and BHP Billiton has been fined 250 million Brazilian reals ($65.5 million) and forced to pay for accommodations for the dispossessed, after two dams burst earlier this month, killing at least seven people, with 15 still missing.
Construction Materials/Inputs Fall in Price Again
The Producer Price Index for inputs to construction industries declined for a fourth consecutive month in October, according to an analysis of the Bureau of Labor Statistics data by the Associated Builders and Contractors (ABC) of America.
The index stands at its lowest level since the first quarter of 2011 as prices for construction inputs declined 0.2% on a monthly basis and 4.6% on a year-ago basis. Nonresidential construction input prices exhibit a similar pattern, falling 0.3% since last month and 5.1% over the past 12 months. Nine of 11 key input prices are down on a year-over-year basis.
Some key takeaways for metal purchasers:
- Steel mill product prices fell 1.7% in October and are 16.1% lower than one year ago.
- Natural gas prices shrank 1.8% on a monthly basis and 36% on a yearly basis.
- Iron and steel prices lost 4.4% month-over-month and 21.2% year-over-year.