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
MFPRO+ News | Jun 3, 2024
New York’s office to residential conversion program draws interest from 64 owners
New York City’s Office Conversion Accelerator Program has been contacted by the owners of 64 commercial buildings interested in converting their properties to residential use.
MFPRO+ News | Jun 3, 2024
Seattle mayor wants to scale back energy code to spur more housing construction
Seattle’s mayor recently proposed that the city scale back a scheduled revamping of its building energy code to help boost housing production. The proposal would halt an update to the city’s multifamily and commercial building energy code that is scheduled to take effect later this year.
Mass Timber | May 31, 2024
Mass timber a big part of Western Washington University’s net-zero ambitions
Western Washington University, in Bellingham, Wash., 90 miles from Seattle, is in the process of expanding its ABET-accredited programs for electrical engineering, computer engineering and science, and energy science. As part of that process, the university is building Kaiser Borsari Hall, the 54,000-sf new home for those academic disciplines that will include teaching labs, research labs, classrooms, collaborative spaces, and administrative offices.
Construction Costs | May 31, 2024
Despite challenges, 2024 construction material prices continue to stabilize
Gordian’s Q2 2024 Quarterly Construction Cost Insights Report indicates that supply chain issues notwithstanding, many commodities are exhibiting price normalization.
University Buildings | May 30, 2024
Washington University School of Medicine opens one of the world’s largest neuroscience research buildings
In St. Louis’ Cortex Innovation District, Washington University School of Medicine recently opened its new Jeffrey T. Fort Neuroscience Research Building. Designed by CannonDesign and Perkins&Will, the 11-story, 609,000-sf facility is one of the largest neuroscience buildings in the world.
Affordable Housing | May 30, 2024
General contractor’s keys to a successful affordable housing project
General contractors can have tremendous influence over a project’s success in terms of schedule, budget, and quality. However, to ensure a project is put on this path, there are a few factors that must be considered.
MFPRO+ New Projects | May 29, 2024
Two San Francisco multifamily high rises install onsite water recycling systems
Two high-rise apartment buildings in San Francisco have installed onsite water recycling systems that will reuse a total of 3.9 million gallons of wastewater annually. The recycled water will be used for toilet flushing, cooling towers, and landscape irrigation to significantly reduce water usage in both buildings.
Healthcare Facilities | May 28, 2024
Healthcare design: How to improve the parking experience for patients and families
Parking is likely a patient’s—and their families—first and last touch with a healthcare facility. As such, the arrival and departure parking experience can have a profound impact on their experience with the healthcare facility, writes Beth Bryan, PE, PTOE, PTP, STP2, Principal, Project Manager, Walter P Moore.
MFPRO+ News | May 28, 2024
ENERGY STAR NextGen Certification for New Homes and Apartments launched
The U.S. Environmental Protection Agency recently launched ENERGY STAR NextGen Certified Homes and Apartments, a voluntary certification program for new residential buildings. The program will increase national energy and emissions savings by accelerating the building industry’s adoption of advanced, energy-efficient technologies, according to an EPA news release.
Women in Design+Construction | May 28, 2024
Commerce Department launches Million Women in Construction Community Pledge
The U.S. Department of Commerce launched its Million Women in Construction Community Pledge this month to boost the ranks of women in construction companies. Federal investments are creating a construction boom that is increasing job opportunities for construction and trade workers.