Construction MMI®: Gas Tax Off the Table, Homebuilder Confidence Slips

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House Transportation Committee Chairman Bill Shuster, R-Pa., says passing a bill to pay for repair and replacement of America’s aging roads and bridges will be a top priority next year but is ruling out a gasoline tax hike or motorist user fees as the way to do it.

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Shuster had previously said a vehicle-miles-traveled tax should be considered as an alternative to increasing the 18.4 cent per gallon gas tax, given the rise in fuel-efficient cars that makes taxing by the gallon rather than the mile less effective. Looking ahead to a new GOP-controlled Congress, Shuster said in a brief interview this month that both proposals are unworkable.

“The president has ruled out a gas tax, I don’t think there’s a will in Congress and the American people don’t want it,” Shuster said in an interview with the Associated Press. He added that a per mile tax was “never really on the table,” pointing in part to lawmaker hesitancy over technical challenges of the government tracking motorists’ mileage.

Congress has been in a deadlock since 2009 over the best way to pay for highways, opting to pass a series of short-term fixes. Current funding expires next May.

Rep. Peter DeFazio, D-Ore., who will be the new ranking member on the committee, said he was optimistic Congress can pass a bipartisan bill, citing a good working relationship with Shuster.

In addition, Shuster said he expected the committee to take up a rail bill early next year that will seek to reinvest Amtrak profits from the Northeast Corridor back into that rail line, rather than subsidize money-losing routes in other parts of US.

While housing starts continued to improve in November, home builder sentiment actually slipped last month.

US  home builders are feeling slightly less confident in their sales prospects heading into next year, even as their overall sales outlook remains favorable.

The National Association of Home Builders/Wells Fargo Builder Sentiment Index released Monday slipped this month to 57, down one point from 58 in November.

Readings above 50 indicate more builders view sales conditions as good, rather than poor.

Builders’ view of current sales conditions and their outlook for sales over the next six months also declined slightly. A measure of traffic by prospective buyers held steady.

The week’s biggest mover on the weekly Construction MMI® was the weekly US Rocky Mountain bar fuel surcharge, which saw a 4.7% decline to $0.41 per short ton. Last week marked the fourth in a row of declining prices for the metal. At $0.40 per mile, the weekly US Midwest bar fuel surcharge finished the week down 4.2%. For the third week in a row, the weekly US Gulf Coast bar fuel surcharge dropped, falling 2.7% to $0.38 per mile.

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The price of Chinese H-beam steel dropped 1.8% this week, closing out the third consecutive week of falling prices at CNY 2,780 ($446.62) per metric ton. The price of Chinese rebar fell 1.7% over the past week to CNY 2,810 ($451.43) per metric ton. This was the third week in a row of declining prices. In the past week, US shredded scrap saw its price shift up 0.3% to $334.00 per short ton. The Chinese low price of 62% Australian iron ore fines remained steady from the previous week at CNY 970.00 ($155.83) per dry metric ton.

European 1050 aluminum dropped 4.4% over the past week to EUR 2,499 ($3,037) per metric ton. Closing out the third week of declining prices, the price of Chinese aluminum bar dropped by 0.8%, finishing at CNY 13,000 ($2,088) 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. 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.

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