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 | Mar 26, 2020
Senate coronavirus relief bill's tax and lending provisions will help construction firms, but industry needs additional measures
Construction officials say measure will help firms cope with immediate cash flow crunch, but industry needs compensation for losses.
Market Data | Mar 25, 2020
Engineering and construction materials prices fall for first time in 40 months on coronavirus impacts, IHS Markit says
Survey respondents reported falling prices for five out of the 12 components within the materials and equipment sub-index.
Market Data | Mar 23, 2020
Coronavirus will reshape UAE construction
The impact of the virus has been felt in the UAE, where precautionary measures have been implemented to combat the spread of the virus through social distancing.
Coronavirus | Mar 20, 2020
Pandemic has halted or delayed projects for 28% of contractors
Coronavirus-caused slowdown contrasts with January figures showing a majority of metro areas added construction jobs; Officials note New infrastructure funding and paid family leave fixes are needed.
Market Data | Mar 17, 2020
Construction spending to grow modestly in 2020, predicts JLL’s annual outlook
But the coronavirus has made economic forecasting perilous.
Market Data | Mar 16, 2020
Grumman/Butkus Associates publishes 2019 edition of Hospital Benchmarking Survey
Report examines electricity, fossil fuel, water/sewer, and carbon footprint.
Market Data | Mar 12, 2020
New study from FMI and Autodesk finds construction organizations with the highest levels of trust perform twice as well on crucial business metrics
Higher levels of trust within organizations and across project teams correlate with increased profit margins, employee retention and repeat business that can all add up to millions of dollars of profitability annually.
Market Data | Mar 11, 2020
The global hotel construction pipeline hits record high at 2019 year-end
Projects currently under construction stand at a record 991 projects with 224,354 rooms.
Market Data | Mar 6, 2020
Construction employment increases by 43,000 in February and 223,000 over 12 months
Average hourly earnings in construction top private sector average by 9.9% as construction firms continue to boost pay and benefits in effort to attract and retain qualified hourly craft workers.
Market Data | Mar 4, 2020
Nonresidential construction spending attains all-time high in January
Private nonresidential spending rose 0.8% on a monthly basis and is up 0.5% compared to the same time last year.