Construction input prices increased 0.9% in April on a monthly basis and 2.4% compared to the same time last year, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics data released today. Nonresidential input prices rose 0.9% compared to March and are up 2.8% on an annual basis.
Among the 11 sub-categories, seven experienced price decreases last month, with the largest decreases in natural gas (-8.7%), iron and steel (-1.7%), and steel mill products (-1.7%). The four sub-categories that experienced monthly price increases were crude petroleum (+13.9%), unprocessed energy materials (+3.7%), prepared asphalt products (+2.7%) and concrete products (+1.1%). Year over year, prepared asphalt products (+7.5%), steel mill products (+5.8%) and plumbing fixtures (+4.3%) experienced the largest price increases.
“Even though April was the third consecutive month that input prices increased and overall materials prices remained elevated, there is little reason for contractors to be on high alert,” said ABC Chief Economist Anirban Basu. “The increase in materials prices was primarily driven by higher energy prices. In particular, the price of oil mainly rose for political reasons, and therefore is not an indication that materials prices will aggressively increase.
“What’s more, the year-over-year increase in construction input prices is a mere 2.4%, which is only slightly higher than overall inflation and a bit lower than wage growth,” said Basu. “With much of the global economy slowing and given ongoing trade tensions between American and Chinese policymakers, it’s likely materials price increases will remain modest going forward, even in the context of a robust nonresidential construction sector.
Related Stories
Market Data | Apr 30, 2020
The U.S. Hotel Construction pipeline continued to expand year-over-year despite COVID-19 in the first quarter of 2020
Many open or temporarily closed hotels have already begun or are in the planning stages of renovating and repositioning their assets while occupancy is low or non-existent.
Market Data | Apr 29, 2020
5 must reads for the AEC industry today: April 29, 2020
A new Human performance Center and Construction employment declines in 99 metro areas.
Market Data | Apr 29, 2020
Construction employment declines in 99 metro areas in March from 2019
Industry officials call for new state and federal funding to add jobs.
Market Data | Apr 28, 2020
5 must reads for the AEC industry today: April 28, 2020
A virtual 'city-forest' to help solve population density challenges and planning for life in cities after the pandemic.
Market Data | Apr 27, 2020
5 must reads for the AEC industry today: April 27, 2020
Colleges begin building campus eSports arenas and PCL Construction rolls out portable coronavirus testing centers.
Market Data | Apr 24, 2020
6 must reads for the AEC industry today: April 24, 2020
Take a virtual tour of Frank Lloyd Wright's Robie House and Construction Contractor Confidence plummets.
Market Data | Apr 23, 2020
Construction Contractor Confidence plummets in February
As of February 2020, fewer than 30% of contractors expected their sales to increase over the next six months.
Market Data | Apr 23, 2020
5 must reads for the AEC industry today: April 23, 2020
The death of the department store and how to return to work when the time comes.
Market Data | Apr 22, 2020
6 must reads for the AEC industry today: April 22, 2020
Repurposed containers can be used as rapid response airborne infection isolation rooms and virtual site visits help control infection on project sites.
Market Data | Apr 21, 2020
ABC's Construction Backlog Indicator down in February
Backlog for firms working in the infrastructure segment rose by 1.3 months in February while backlog for commercial and institutional and heavy industrial firms declined by 0.6 months and 0.7 months, respectively.