The largest monthly gain in petroleum prices in over three years caused construction materials prices to expand 0.4 percent in February, ending a six-month streak when prices failed to rise, according to the March 13 producer price index release by the Bureau of Labor Statistics. On a year-over-year basis, construction input prices fell 3.9%. Nonresidential construction input prices also rose 0.4% on a monthly basis and were down 4.9% on a yearly basis.
"While conventional wisdom suggests that oil and natural gas prices will eventually rise, the adjustment period could be a lengthy one and although crude petroleum prices were up 12.3% on a monthly basis, this is likely a function of an abnormally cold February," said Associated Builders and Contractors Chief Economist Anirban Basu. "This rise is the first monthly gain since April 2014 and the eighth consecutive month in which petroleum prices were down on a year-over-year basis.
"For now, inventories of fuel remain elevated and most believe that the U.S. dollar's upward movement is not at an end," said Basu. "This, in addition to the quantitative easing that has begun in Europe and the potential for increasing interest rates in America, means that there is likely to be greater demand for U.S. fixed income assets, which will serve to further strengthen the U.S. dollar and put downward pressure on certain key construction input prices. This dynamic was widely apparent in February, during which prices for seven of the 11 key construction inputs failed to rise and no input other than crude petroleum increased in excess of one percent."
The following materials prices increased in February:
- Nonferrous wire and cable prices grew 0.8% on a monthly basis but fell 4.4% on a yearly basis
- Crude petroleum prices gained 12.3% in February but are down 53.4% from the same time last year.
- Crude energy materials prices expanded 0.9% in February but are 45% lower year-over-year.
- Concrete products prices expanded 0.2% in February and are up 4.3% on a yearly basis.
Seven of the 11 key construction inputs did not expand for the month:
- Prices for plumbing fixtures fell 0.1% in February but are up 3.0% on a year-over-year basis.
- Fabricated structural metal product prices remained flat for the month and have expanded 1.0% on a year-over-year basis.
- Prices for prepared asphalt, tar roofing, and siding fell 1.4% for the month but are up 1.7% on a year-ago basis.
- Iron and steel prices fell 5.4% in February and are down 10.6% from the same time last year.
- Steel mill products prices fell 1.8% for the month and are 3.6% lower than one year ago.
- Softwood lumber prices fell 3.7% in February and are 4.4% lower than one year ago.
- Natural gas prices fell 11.2% in February and are down 51.8% from one year ago.
Related Stories
Multifamily Housing | Jun 21, 2022
Two birds, one solution: Can we solve urban last-mile distribution and housing challenges at the same time?
When it comes to the development of both multifamily housing and last-mile distribution centers, particularly in metropolitan environments, each presents its own series of challenges and hurdles. One solution: single-use structures.
Libraries | Jun 21, 2022
Kingston, Ontario, library branch renovation cuts energy use to 55% of benchmark
A recent renovation of the Kingston (Ontario) Frontenac Public Library Central Branch greatly boosted energy and water efficiency while making the facility healthier and safer.
Building Materials | Jun 20, 2022
Early-stage procurement: The next evolution of the construction supply chain
Austin Commercial’s Jason Earnhardt explains why supply chain issues for the construction industry are not going to go away and how developers and owners can get ahead of project roadblocks.
Building Team | Jun 20, 2022
Andres Caballero Appointed President of Uponor North America
Uponor Corporation (Uponor) has named Andres Caballero president of its Building Solutions – North America division and a member of the Executive Committee at Uponor.
| Jun 20, 2022
An architectural view of school safety and security
With threats ranging from severe weather to active shooters, school leaders, designers, and security consultants face many challenges in creating safe environments that allow children to thrive.
School Construction | Jun 20, 2022
A charter high school breaks ground in L.A.’s Koreatown
A new charter school has broken ground in Los Angeles’ Koreatown neighborhood.
Building Team | Jun 17, 2022
Data analytics in design and construction: from confusion to clarity and the data-driven future
Data helps virtual design and construction (VDC) teams predict project risks and navigate change, which is especially vital in today’s fluctuating construction environment.
Sports and Recreational Facilities | Jun 17, 2022
U. of Georgia football facility expansion provides three floors for high-performance training
A major expansion of the University of Georgia’s football training facility has been completed.
Building Team | Jun 16, 2022
Hybrid work expected to reduce office demand by 9%
Businesses are slowly but consistently transitioning to a permanent hybrid work environment, according to a senior economist at Econometric Advisors.
Building Team | Jun 16, 2022
USGBC announces more than 23 million square feet of LEED certified net zero space
Today, the U.S. Green Building Council announced nearly 100 net zero certifications earned under the LEED Zero program, representing more than 23 million square feet of space.
