Construction MMI: U.S. Construction Spending in March Drops 0.8% Year Over Year

The Construction Monthly Metals Index (MMI) gained one point for a May reading of 84.
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U.S. Construction Spending

According to the U.S. Census Bureau, U.S. construction spending during March 2019 came in at an estimated seasonally adjusted annual rate of $1,282.2 billion, or down 0.9% from the revised February estimate of $1,293.3 billion.
In addition, the March spending estimate marks a 0.8% decline from the March 2018 estimate of $1,293.1 billion.
Meanwhile, Q1 construction spending reached $277.7 billion, down 0.2% compared with Q1 2018.
Under private construction, spending reached $961.5 billion, down 0.7% from February. Within private construction, residential construction hit $500.9 billion in March, down 1.8% from February. Nonresidential construction came in at $460.6 billion in March, up 0.5% from February.
As for public construction, spending in that segment hit $320.7 billion, down 1.3% from February. Educational construction spending fell 1.5% to $76.6 billion, while highway construction spending fell 1.9% to $104.5 billion.

Billings Growth Slows

According to the monthly Architecture Billings Index (ABI) put out by the American Institute of Architects, March proved to be a down month for billings growth.
The March ABI value was 47.8, down from 50.3 the previous month (anything above 50 indicates growth, while anything below 50 indicates contraction). Per the report, billings declined for the first time in over two years.
“While this score may raise concerns about the start of a period of weaker business conditions, it is important to note that it does follow on the heels of a particularly tough late winter period for much of the country, with record-setting cold, storms, and floods,” an AIA release on the report states. “In addition, many indicators of future work at firms remain positive, with both inquiries into new work and the value of new design contracts continuing to grow, although the pace of growth of design contracts has slowed in recent months. Backlogs of work at architecture firms also rose to a new high of 6.5 months in March, up from 6.3 months one year ago.”
The South was the only region out of the four tracked in the ABI to show billings growth, posting an ABI value of 54.2. The Midwest (48.7), West (47.2) and Northeast (43.5) all came in at sub-50 values.
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Actual Metal Prices and Trends

Chinese rebar increased 5.8% month over month to $606.97/mt as of May 1. Chinese H-beam steel rose 2.5% to $577.29/mt.
U.S. shredded scrap steel fell 3.3% to $321/st.
European commercial 1050 aluminum sheet fell 0.9% to $2,618/mt. Chinese aluminum bar rose 2.6% to $2,266.13/mt.