Construction input prices dipped 1.4% during the final month of 2014 and are down nearly 1% on a year-over-year basis, according to the Jan. 15 producer price index release from the U.S. Department of Labor.
Inputs to nonresidential construction fell even further, down 1.7% for the month and 1.9% year over year. December's report marks the sharpest decline in input prices since late 2008 during the global financial crisis and the fifth consecutive month construction materials prices have failed to rise.
"Without question, financial markets have been unnerved by the recent declines in oil, copper and other commodity prices, although that jitteriness does not necessarily imply a serious economic problem in America," said Associated Builders and Contractors Chief Economist Anirban Basu. "The fact is the U.S. economy has performed handsomely over the past nine months, according to most metrics, and conventional wisdom suggests that it can continue to expand at or above trend rates of growth despite economic weakening in Europe, China and elsewhere. This is further evidenced by the World Bank's recent downgrade of its forecasts for global growth in 2015 and 2016, while it upgraded its outlook for the United States.
"Overall, the view that U.S. domestic demand for construction services and most other services continues to expand is consistent with the fact that some domestically produced and consumed materials actually registered price increases last month," said Basu. "Note that concrete prices are up by 5% on a year-over-year basis while natural gas prices are up by 10%."
The following materials prices increased in December:
• Prices for plumbing fixtures expanded 0.1% in December and are up 3.1% on a year-over-year basis.
• Concrete products prices expanded 0.7% in December and are up 5% on a yearly basis.
• Natural gas prices expanded 19.7% in December and are 10% higher than one year ago.
• Fabricated structural metal product prices grew 0.3% for the month and have expanded 1.5% on a year-over-year basis.
• Seven of the 11 key construction inputs did not experience price increases for the month.
• Iron and steel prices fell 1% in December and are down 3.9% from the same time last year.
• Nonferrous wire and cable prices fell 1.6% on a monthly basis and 1.5% on a yearly basis.
• Prices for prepared asphalt, tar roofing, and siding fell 1% for the month but are up 1.9% on a year-ago basis.
• Steel mill products prices fell 1.3% for the month but are 0.4% higher than one year ago.
• Softwood lumber prices fell 1.3% in December but are 0.3% higher than one year ago.
• Crude petroleum prices fell 18.9% in December and are down 37.1% from the same time last year.
• Crude energy materials prices fell 4.7% in December but are 19.6% lower year-over-year.
Related Stories
BIM and Information Technology | Dec 28, 2014
The Big Data revolution: How data-driven design is transforming project planning
There are literally hundreds of applications for deep analytics in planning and design projects, not to mention the many benefits for construction teams, building owners, and facility managers. We profile some early successful applications.
| Dec 28, 2014
AIA course: Enhancing interior comfort while improving overall building efficacy
Providing more comfortable conditions to building occupants has become a top priority in today’s interior designs. This course is worth 1.0 AIA LU/HSW.
| Dec 28, 2014
6 trends steering today's college residence halls
University students want more in a residence hall than just a place to sleep. They want a space that reflects their style of living and learning.
| Dec 28, 2014
Using energy modeling to increase project value [AIA course]
This course, worth 1.0 AIA LU/HSW, explores how to increase project value through energy modeling, as well as how to conduct quick payback and net present value studies to identify which energy strategies are most viable for the project.
| Dec 28, 2014
The lowdown on LODs: Bringing clarity to BIM
These days, BIM is par for the course across most facets of design. But a lot of the conversation surrounding BIM still lacks clarity due to ambiguous terminology, a lack of clear-cut guiding illustrations, and widely varying implementation, writes GS&P's John Scannell.
| Dec 28, 2014
The future of airport terminal design: destination status, five-star amenities, stress-free travel
Taking a cue from the hospitality industry, airport executives are seeking to make their facilities feel more like destinations, writes HOK's Richard Gammon.
| Dec 28, 2014
10 key design interventions for a healthier, happier, and more productive workplace
Numerous studies and mountains of evidence confirm what common sense has long suggested: healthy, happier workers are more productive, more likely to collaborate with colleagues, and more likely to innovate in ways that benefit the bottom line, writes Gensler's Kirsten Ritchie.
| Dec 28, 2014
7 fresh retail design strategies
Generic ‘boxes’ and indifferent service won’t cut it with today’s savvy shoppers. Retailers are seeking a technology-rich-but-handmade vibe, plus greater speed to market and adaptability.
| Dec 28, 2014
Workplace design trends: Make way for the Millennials
Driven by changing work styles, mobile technology, and the growing presence of Millennials, today’s workplaces are changing, mostly for the better. We examine the top office design trends.
| Dec 28, 2014
AIA: Commercial glass façade and door systems
When it comes to selecting fenestration systems—particularly glass facades and door systems—a number of factors come into play, requiring a thorough evaluation of a project’s individual requirements.
