Construction input prices increased 1.9% in June compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data released today. Nonresidential construction input prices increased 1.8% for the month.
Construction input prices are up 20.1% from a year ago, while nonresidential construction input prices are 20.3% higher. On a monthly basis, input prices were down in four of 11 subcategories in June, with the largest decline registered in the softwood lumber category (-24.8%). All three energy subcategories experienced price increases, with natural gas prices rising 24.3% for the month.
“It’s no secret that contractors and their customers have been walloped by massive increases in construction materials prices,” said ABC Chief Economist Anirban Basu. “That inflation continued through June, as reflected in the decline in profit margin expectations seen in the most recent reading of ABC’s Construction Confidence Index. But more recently, key commodity prices have declined, so it may be possible we have achieved peak inflation.
“Indeed, with much of the world at risk of recession, there is likely to be further downward pressure on commodity prices going forward,” said Basu. “Oil prices had been in the range of $120/barrel recently. As of this morning, the price of oil has dipped into the low $90s. Similarly, natural gas prices have been in decline. In part, this may be because global supply chains are readjusting to disruptions caused by the Russia-Ukraine war. The war creates an ongoing risk of sudden spikes in certain commodity prices, but we appear to be entering a new phase in input price trajectory.”
Related Stories
Architects | Mar 28, 2017
A restroom for everyone
Restroom access affects everyone: people with medical needs or disabilities, caretakers, transgender people, parents with children of the opposite gender, and really anyone with issues or needs around privacy.
Building Team | Mar 6, 2017
AEC firms: Your website is one of the most important things you'll build
Don’t believe it? You’d better take a look at the research.
Building Team | Mar 1, 2017
Intuitive wayfinding: An alternate approach to signage
Intuitive wayfinding is much like navigating via waypoints—moving from point to point to point.
Building Team | Feb 21, 2017
Artifacts down the street: Exploring urban archaeology
Archaeologists continually unearth artifacts in our cities. It's time to showcase them.
Building Team | Feb 2, 2017
HOK joins Well Living Lab Alliance sponsored by Delos and Mayo Clinic
The Well Living Lab studies the connection between health and the indoor environment to transform human health and well-being in places where we live, work, learn, and play.
Architects | Jan 24, 2017
Politicians use architectural renderings in bid to sell Chicago’s Thompson Center
The renderings are meant to show the potential of the site located in the heart of the Chicago Loop.
Designers | Jan 13, 2017
The mind’s eye: Five thoughts on cognitive neuroscience and designing spaces
Measuring how the human mind responds to buildings could improve design.
Building Team | Jan 11, 2017
Can design help close the nation's political divide?
Practically every building typology is evolving to meet the needs of the innovation economy. Why not legislative spaces?
Building Team | Jan 10, 2017
Fiber canopies proposed to turn Phoenix streets into comfortable public space
The proposal was the winning entry in a design competition asking for ways to strengthen the identity of the Arizona city.
Building Team | Jan 6, 2017
CannonDesign launches REALIZE Life Safety Solutions
“The Final Rule presents a considerable update to the life safety directives most healthcare systems have become accustomed to,” says Joe Cassata, principal at CannonDesign.
