Construction materials prices expanded 0.7 percent in February and are up 0.6 percent over the past year, according to the March 14 producer price index release by the Department of Labor. More specifically, nonresidential construction materials prices are up 0.7 percent for the month and are 0.4 percent higher than the same time one year ago.
“February marks the second consecutive month in which construction materials prices expanded briskly,” said Associated Builders and Contractors Chief Economist Anirban Basu. “Construction materials prices experienced a remarkable lack of volatility during the last three quarters of 2013; however, that trend appears to be firmly behind us.”
Overall, the nation’s wholesale goods prices expanded 0.4 percent in February and are up 1.3 percent from February 2013. Crude energy materials prices and natural gas prices led the way, expanding 14.7 percent and 31.5 percent respectively in February. February marked the crude energy segment’s largest monthly growth since January 2004.
“The harsh winter is to blame for the spike in energy segment prices,” said Basu. “In fact, crude petroleum and natural gas both experienced historic price growth in February. We are certain that February’s data reflects the colder-than-normal winter; however, it is difficult to say if increased demand had any part in the month’s price growth. With the frigid weather continuing through early March, it may be awhile before we know this winter’s true impact.
“Another factor has been a tidal wave of economic news from China, much of which suggests that China’s economy is slowing faster than expected,” said Basu. “That could cause prices to dip during future months. In any case, greater price volatility should be anticipated.”
The prices of the following materials increased in February.
- Natural gas prices expanded 31.5 percent in February and are 74 percent higher than one year ago.
- Crude energy prices grew 14.7 percent in February and are 18.1 percent higher than one year ago.
- Concrete products prices grew 0.9 percent in February and are 3.7 percent higher than one year ago.
- Steel mill products prices expanded 0.7 percent for the month and are 1.9 percent higher than one year ago.
- Prices for prepared asphalt, tar roofing, and siding expanded by 1.4 percent for the month but are down 0.4 percent from one year ago.
- Crude petroleum prices grew 10.6 percent in February and are 3.4 percent higher than one year ago.
- Prices for plumbing fixtures expanded 1.5 percent for the month and are 3.1 percent higher than one year ago.
- Fabricated structural metal product prices are up 0.1 percent and are 0.4 percent higher than one year ago.
- Softwood lumber prices gained 0.5 percent and are 1.2 percent higher than one year ago.
Only two key construction inputs did not experience price increases for the month.
- Nonferrous wire and cable prices shed 0.4 percent on a monthly basis and are down 4.3 percent from one year ago.
- Iron and steel prices fell 0.4 percent in February but are up 4.3 percent from one year ago.
To read the previous construction materials report, click HERE