Residential Building Material Prices Remain Relatively Unchanged in May

2024-06-13T11:17:19-05:00

Inputs to residential construction, goods less food and energy, fell 0.09% over the month according to the most recent producer price index (PPI) report published by the U.S. Bureau of Labor Statistics. The index for inputs to residential construction, goods less food and energy, represents building materials used in residential construction. This was the first decrease in the index since October of last year. While the index fell over the month, it was 2.91% higher than May of last year.   The seasonally adjusted PPI for final demand goods decreased 0.78% in May, after increasing a revised 0.41% in April. This was the largest decrease in the index for final demand goods since a 1.24% decline in October of last year. According to BLS, around 60% of the monthly decline in May was due to a 7.11% drop in the index for gasoline.  The PPI for final demand energy and final demand foods both fell at 4.76% and 0.10% respectively. At the same time, the PPI for final demand goods, less foods and energy, rose 0.26%. The seasonally adjusted PPI for softwood lumber fell for the first time since February, down 5% over the month. Prices for softwood lumber remain lower than last year at 8.10% below May of 2023. It was the 19th consecutive month where the softwood lumber index was lower than one year ago. The non-seasonally adjusted special commodity grouping PPI for copper rose 8.47% in May after rising 3.44% in April. Over the year, the index was up 17.14%. Given the global goals of electrification, copper is an important commodity for many electrical goods given its efficient conductivity properties. A recent report from the International Energy Agency shows that copper mine supply levels will not meet future demand. Expected total demand of copper is expected to outpace future expected supply by 43.38% by 2040. The non-seasonally adjusted PPI for gypsum building materials was unchanged over the month but was up 2.09% over the year. Price growth for gypsum building materials has slowed from the growth we saw during the pandemic and has remained muted from about the second half of 2022. The seasonally adjusted PPI for ready-mix concrete fell for the second consecutive month, down 0.13% in May after falling from 0.9% in April. Ready-mix concrete remains well above last year’s level, up 5.65% since a year ago. The non-seasonally adjusted PPI for steel mill products rose 0.54% in May after falling in the two previous months. Year-over-year, steel mill product prices were lower than one year ago for the third straight month, down 13.81% from May of last year. Discover more from Eye On Housing Subscribe to get the latest posts to your email.

Residential Building Material Prices Remain Relatively Unchanged in May2024-06-13T11:17:19-05:00

Mixed Price Changes for Building Materials in April

2024-05-14T11:17:11-05:00

Inputs to residential construction, goods less food and energy, increased for the sixth consecutive month, according to the most recent producer price index (PPI) report published by the U.S. Bureau of Labor Statistics. The index for inputs to residential construction, goods less food and energy, represents building materials used in residential construction. The non-seasonally adjusted index increased 0.14% in April after increasing a revised 0.50% in March and 0.47% in February. The index is up 2.77% from April 2023, the largest yearly increase since 2.80% in February of 2023. The average yearly change, over all 12 months, was 2.50% in 2020, 14.62% in 2021, 15.18% in 2022, and 1.34% in 2023. Over the first four months of 2024, the average change was 2.32%. The seasonally adjusted PPI for final demand increased 2.18% from last year, the largest yearly increase since April 2023 (2.30%). Over the month, the final demand index rose 0.56%. From the BLS, “Nearly three-quarters of the April advance in final demand prices is attributable to a 0.55% increase in the index for final demand services. Prices for final demand goods moved up 0.44%”. The seasonally adjusted PPI for softwood lumber increased 6.20% in April. This was the largest month-over-month increase since January of 2022 when the index shot up 21.56% over the month. From April of 2023, the index was 4.31% lower. The non-seasonally adjusted PPI for gypsum building materials fell 0.74% in April.  Despite falling over the month, prices for gypsum building materials were 1.00% higher than April of last year. The seasonally adjusted PPI for ready-mix concrete fell for the first time in four months, down 0.27% in April. Prices for ready-mix concrete have continued to increase since 2021, as this was only the fourth price decline since January 2021. Year-over-year, ready-mix concrete prices were 8.04% higher. The non-seasonally adjusted PPI for steel mill products fell for the second straight month, down 2.67% for April after an 8.10% decline in March. Prices for steel mill products are 9.79% lower than last year. The non-seasonally adjusted special commodity grouping PPI for copper rose 3.46% in April. Over the year, the index was up 4.46%. Copper futures pricing, not shown here, was trading near $4.90 per pound as of today, its highest level since early 2022 at $5.00 per pound. Discover more from Eye On Housing Subscribe to get the latest posts to your email.

Mixed Price Changes for Building Materials in April2024-05-14T11:17:11-05:00

How Lumber Prices are Affecting Homebuilders

2021-05-13T12:28:42-05:00

They say a picture can tell a thousand words. Well, this new visual representation of the impact of lumber pricing on homebuilders certainly fits. Published on May 8th by Visual Capitalist, the amazing infographic shows the impact of lumber

How Lumber Prices are Affecting Homebuilders2021-05-13T12:28:42-05:00

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