Continuing Construction Material Cost Increases Are Alarming
For 15 of the most important building materials or construction-related inputs, Table 1 highlights year-over-year and latest-three-months’ price changes.
More than doubling in price over the past year have been softwood lumber, +154.3%; particleboard and OSB, +121.5%; regular gasoline, +151.9%; and diesel fuel, +199.2%.
With cost lifts lying between +50% and +99% are plywood, +98.4%; iron and steel scrap +76.6%; and asphalt, +62.3%.
Asphalt also has the distinction, however, of being one of only two items that experienced a price drop month to month in May, -13.8%. Coal, as a base material going into steel production, was the other, -0.3% m/m.
Latest PPI Results
The most accessible single-source resource on construction material price movements is the Producer Price Index data set from the Bureau of Labor Statistics. The PPI series monitors prices charged by producers as they exit through factory gates.
One drawback of a government statistical series, however, is that it will inevitably lag behind what is occurring in the real world, due to a time delay in collecting and tabulating results. The latest PPI figures are for May.