Construction MMI: August U.S. Construction Spending Up 6.5% Year Over Year

The Construction Monthly Metals Index (MMI) lost two points this month, falling for a reading of 90. 

U.S. Construction Spending

U.S. construction spending in August — the most recently available month of Census Bureau data — hit $1,318.5 billion, up 0.1% from the revised July estimate.
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In addition, August spending marked a 6.5% increase from August 2017 spending.
Through the first eight months of the year, spending hit $862 billion, marking a 5.3% increase from the same period in 2017.

Under the umbrella of private construction, spending amounted to a seasonally adjusted annual rate of $1,001.7 billion, or 0.5% below the revised July estimate of $1,006.9 billion.
Within private construction, residential construction reached $548.9 billion in August, down 0.7%  from the previous month. Nonresidential construction spending reached $452.9 billion, 0.2% below that of the previous month.
Meanwhile, in public construction, total spending was $316.7 billion, marking a 2.0% increase from the revised July estimate of $310.5 billion.
Within public construction, educational construction was at a seasonally adjusted annual rate of $72.3 billion, or 1.0% above the revised July estimate of $71.7 billion. Highway construction hit $99.0 billion, or up 1.7%.

ABI Hits Second-Highest Value of 2018

The Architecture Billings Index (ABI), produced by the American Institute of Architects (AIA), hit 54.8 in August, its second-highest value in 2018.
An ABI value of 50 indicates no growth, with anything greater than 50 indicating billings growth.
“Billings at US architecture firms saw a healthy jump in August, a positive sign as firms enter what is traditionally a seasonal slowdown,” the AIA’s ABI report for the month states.
By region, the South led the way with an ABI of 57.0, followed by the West (54.2), Midwest (52.5) and Northeast (46.9).
Despite strong growth — particularly the Q2 GDP growth of 4.2%, the highest since 2014 — the AIA report offered a cautionary note.
“In spite of these strong economic numbers, the length of this current business expansion has many worried about its resiliency,” the report stated. “Leading economic indicators—interest rates, building permits, and new orders for capital goods—have been less favorable recently.”
In addition, this month’s ABI report polled respondents about productivity levels in their workplaces.  According to the report, half of respondents felt productivity at their workplace was as good or better than their peers, while one-third indicated their workplaces were about on par with their peers.
Drilling down further, over 80% of respondents said learning new technologies can impact productivity in the short term. (MetalMiner’s Stuart Burns wrote on the subject of technology and productivity last week.) At the same time, a nearly equal percentage of respondents indicated new technologies made their workplaces more productive.
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Actual Metal Prices and Trends

Chinese rebar steel rose 3.1% to $682.63/mt. Chinese H-beam steel rose 0.1% to $614.22/mt.
U.S. shredded scrap steel fell 1.1% to $350/st.
European commercial 1050 sheet aluminum dropped 2.5% to $2,829.32/mt.
Chinese aluminum bar rose 6.2% to $2,256.03/mt.

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