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
| Jul 22, 2013
Top Office Sector Construction Firms [2013 Giants 300 Report]
Turner, Structure Tone, PCL top Building Design+Construction's 2013 ranking of the largest office sector contractors and construction management firms in the U.S.
| Jul 22, 2013
Top Office Sector Engineering Firms [2013 Giants 300 Report]
AECOM, Parsons Brinckerhoff, Jacobs top Building Design+Construction's 2013 ranking of the largest office sector engineering and engineering/architecture firms in the U.S.
| Jul 22, 2013
Top Office Sector Architecture Firms [2013 Giants 300 Report]
Gensler, HOK, Perkins+Will top Building Design+Construction's 2013 ranking of the largest office sector architecture and architecture/engineering firms in the U.S.
| Jul 22, 2013
Market gains encourage better workplace design [2013 Giants 300 Report]
The commercial office sector is finally heating up, led by corporate headquarter and medical office building projects.
| Jul 22, 2013
Top Hotel Construction Firms [2013 Giants 300 Report]
Manhattan Construction, Structure Tone, Lend Lease top Building Design+Construction's 2013 ranking of the largest hotel contractors and construction management firms in the U.S.
| Jul 22, 2013
Top Hotel Architecture Firms [2013 Giants 300 Report]
Gensler, WATG, HKS top Building Design+Construction's 2013 ranking of the largest hotel architecture and architecture/engineering firms in the U.S.
| Jul 22, 2013
Hotel business continues to shine [2013 Giants 300 Report]
Despite some economic stressors, hotel operating fundamentals are poised to remain strong in 2013.
| Jul 22, 2013
Transportation Facility Report [2013 Giants 300 Report]
Building Design+Construction's rankings of design and construction firms with the most revenue from airport terminals and other transportation-related facilities, as reported in the 2013 Giants 300 Report.
| Jul 22, 2013
Convention Center Report [2013 Giants 300 Report]
Building Design+Construction's rankings of design and construction firms with the most revenue from convention center projects, as reported in the 2013 Giants 300 Report.
| Jul 22, 2013
Cultural Facility Report [2013 Giants 300 Report]
Building Design+Construction's rankings of design and construction firms with the most revenue from cultural facility projects, as reported in the 2013 Giants 300 Report.
