WASHINGTON — Construction input prices rose 3.5% in January from the previous month, according to a Builders and associated contractors analysis of US Bureau of Labor Statistics Producer Price Index data. Non-residential construction input prices rose 3.1% during the month.
Construction input prices have risen 23.6% over the past 12 months, while non-residential construction input prices have risen 24.3%. Input prices for natural gas and unprocessed energy materials fell for the month by 26.1% and 4.7%, respectively. Crude oil prices rose 15.5% in January. All three energy subcategories are up significantly year over year.
“While many economists expect inflation to moderate over the course of 2022, at present there is effectively no relief in sight for the country’s entrepreneurs,” the economist said. chief of ABC Anirban Basu. “Inflation remains hot, hot, hot, with estimates of price increases repeatedly exceeding consensus expectations. There was a sharp rise in materials prices in January despite falling natural gas prices. There was also a slight relief in prices for metals such as iron and steel, but this was more than offset by categories registering price increases, including softwood lumber, plumbing fixtures, concrete and crude oil.
“It may seem naive given the current data, but it is expected that at some point later this year, building material prices will moderate.” Basu said. “As the pandemic subsides, supply chains will become more orderly. There are already indications that shipping costs are headed down, and contractors remain optimistic, according to ABC’s Construction Confidence Index. No doubt some builders will choose to push back start dates in the hope of securing lower bids in the months to come. The question is how many months they will have to wait.
Prices for goods used in non-energy residential construction climbed 3.6% in January (not seasonally adjusted), according to the latest Producer Price Index (PPI) report from the Bureau of Labor Statistics. The index was led higher by a 25.4% jump in softwood lumber prices and 9.0% increases in interior and exterior paint prices.
the National Association of Home Builders points out that prices for building materials are up 20.3% year-on-year and 28.7% since January 2020. Over the past four months, the index has climbed 8.4% .