Construction Materials Prices Continue to Climb

A monthly report by the Associated Builders and Contractors (ABC) notes that prices for construction materials increased by 0.9 percent in January 2011, the fourth straight monthly increase. The increase, ABC warns, is a sign that inflation is starting to creep into the construction industry. Further, ABC adds that the monthly Producer Price Index for January 2011 is 4.9 percent greater than for the same time in 2010.
 

Broken out by individual materials, the group reports that iron and steel prices jumped 4.7 percent in January and are up 16.4 percent over the last 12 months. Softwood lumber prices increased by 3.6 percent for the month and are up 8.7 percent year-over-year. Steel mill product prices increased 2 percent for January and are up 11.5 percent from the same time last year. Prices for fabricated structural metal products posted the largest monthly increase since August 2008, up 1.2 percent in January and up 4 percent from January 2010. Prices for plumbing fixtures and fittings inched up 0.3 percent for the month and are up 1.4 percent year-over-year. Prices for prepared asphalt, tar roofing and siding increased by 0.1 percent for the month and by 3.6 percent from January 2010.

Nonferrous wire and cable prices decreased for the first time since July 2010, down 0.8 percent this past January, but they are still 9.1 percent higher than in January 2010. Concrete product prices slipped 0.8 percent in January and are unchanged year-over-year.

Crude energy material prices increased by 1.9 percent in January, but are down 4.3 percent from January 2010. Overall, total wholesale goods prices were up 0.8 percent in January and 3.6 percent from January 2010.

“It may be that the inflation people have been predicting for months is finally here,” says Anirban Basu, ABC chief economist, in a news release.