A new report from the Associated Builders and Contractors found that prices for inputs to construction industries rose by 1.1% in May—the largest month-over-month increase in more than two years. The rise is also the third time in the last 10 months that construction materials prices have grown on a monthly basis.
Although prices saw gains in May, year-over-year prices dropped by 3% in May and have now fallen by more than 3% in each of the first five months of 2015. Of the 11 key construction inputs, only three experienced monthly price increases in May.
"Commodity markets experienced a reversal of several patterns that have been in place for many months in May," said Associated Builders and Contractors' Chief Economist Anirban Basu. "Most notably, key energy prices rose meaningfully, with oil prices rising to roughly $50 per barrel. While natural gas prices did not rise for the month according to the producer price index, they remained relatively flat after falling by more than 10% in three of the year's first four months. Many economic forces were at work, including a weaker U.S. dollar. Many commodities are priced in dollars, which helps to lay a floor under the associated prices. With the European economy showing signs of life the dollar's rise against the euro has effectively stalled."
Basu added that stakeholders should not consider this news the beginning of a new trend as there are several reasons to expect the U.S. dollar to advance against other major currencies over the course of the next few months. Of these expectations, there's an anticipated shift in monetary policy. An increase in interest rates will help to suppress further increases in commodity prices including those related to energy.
Only three of the key materials' prices increased in May:
• Crude petroleum prices expanded 15.6% in May but are down 42% from the same time last year.
• Crude energy materials prices gained 7.7% in May but are 37.3% lower year-over-year.
• Nonferrous wire and cable prices expanded 0.9% on a monthly basis but shed 2.8% on a yearly basis.
Eight of the 11 key construction inputs did not expand for the month:
• Fabricated structural metal product prices dropped 0.5% lower for the month but have expanded 0.8% on a year-over-year basis.
• Natural gas prices fell 1.7% in May and are down 48.4% from the same time one year ago.
• Prices for plumbing fixtures remained flat in May and are up 4.9% on a year-over-year basis.
• Prices for prepared asphalt, tar roofing and siding fell 1.5% for the month and are down 1.9% on a year-ago basis.
• Iron and steel prices fell 1% in May and are down 14.9% from the same time last year.
• Steel mill products prices fell 2% for the month and are 11% lower than one year ago.
• Softwood lumber prices fell 2.5% and are 7.9% lower than one year ago.
• Concrete product prices remained flat in May and are up 4.9% on a yearly basis.
Related Stories
Mass Timber | Jul 11, 2023
5 solutions to acoustic issues in mass timber buildings
For all its advantages, mass timber also has a less-heralded quality: its acoustic challenges. Exposed wood ceilings and floors have led to issues with excessive noise. Mass timber experts offer practical solutions to the top five acoustic issues in mass timber buildings.
Apartments | Jun 27, 2023
Dallas high-rise multifamily tower is first in state to receive WELL Gold certification
HALL Arts Residences, 28-story luxury residential high-rise in the Dallas Arts District, recently became the first high-rise multifamily tower in Texas to receive WELL Gold Certification, a designation issued by the International WELL Building Institute. The HKS-designed condominium tower was designed with numerous wellness details.
Building Materials | Jun 14, 2023
Construction input prices fall 0.6% in May 2023
Construction input prices fell 0.6% in May compared to the previous month, according to an Associated Builders and Contractors analysis of the U.S. Bureau of Labor Statistics’ Producer Price Index data released today. Nonresidential construction input prices declined 0.5% for the month.
Mass Timber | Jun 13, 2023
Mass timber construction featured in two-story mixed-use art gallery and wine bar in Silicon Valley
The Edes Building, a two-story art gallery and wine bar in the Silicon Valley community of Morgan Hill, will prominently feature mass timber. Cross-laminated timber (CLT) and glulam posts and beams were specified for aesthetics, biophilic properties, and a reduced carbon footprint compared to concrete and steel alternatives.
Cladding and Facade Systems | Jun 5, 2023
27 important questions about façade leakage
Walter P Moore’s Darek Brandt discusses the key questions building owners and property managers should be asking to determine the health of their building's façade.
AEC Tech | May 9, 2023
4 insights on building product manufacturers getting ‘smart’
Overall, half of building product manufacturers plan to invest in one or more areas of technology in the next three years.
Building Technology | May 4, 2023
3D printing for construction advances in Germany
The largest 3D-printed building in Europe will have a much lower carbon footprint.
Mass Timber | May 3, 2023
Gensler-designed mid-rise will be Houston’s first mass timber commercial office building
A Houston project plans to achieve two firsts: the city’s first mass timber commercial office project, and the state of Texas’s first commercial office building targeting net zero energy operational carbon upon completion next year. Framework @ Block 10 is owned and managed by Hicks Ventures, a Houston-based development company.
3D Printing | Apr 11, 2023
University of Michigan’s DART Laboratory unveils Shell Wall—a concrete wall that’s lightweight and freeform 3D printed
The University of Michigan’s DART Laboratory has unveiled a new product called Shell Wall—which the organization describes as the first lightweight, freeform 3D printed and structurally reinforced concrete wall. The innovative product leverages DART Laboratory’s research and development on the use of 3D-printing technology to build structures that require less concrete.
Student Housing | Mar 13, 2023
University of Oklahoma, Missouri S&T add storm-safe spaces in student housing buildings for tornado protection
More universities are incorporating reinforced rooms in student housing designs to provide an extra layer of protection for students. Storm shelters have been included in recent KWK Architects-designed university projects in the Great Plains where there is a high incidence of tornadoes. Projects include Headington and Dunham Residential Colleges at the University of Oklahoma and the University Commons residential complex at Missouri S&T.
