Diesel prices have jumped 22.8 since January 2022, according to an analysis of January 2023 government data by the Associated General Contractors of America. Diesel has increased 7.1 percent since December 2022.
Diesel, concrete, and gypsum prices increased steeply in January, according to the group, offsetting sharp declines in lumber and steel prices.
“Producer price indexes for construction inputs moderated over the past year but many items increased again in January,” said Ken Simonson, chief economist, in a statement. “With demand shifting among project types, prices for many inputs are likely to diverge further in 2023.”
The producer price index for inputs to new nonresidential construction jumped 0.9 percent in January but rose by a relatively modest 4.3 percent from January 2022. Falling demand for new homes drove the index for new single-family construction down to a year-over-year increase of just 0.2 percent.
The increase in January was driven by several inputs. In addition to the diesel price increases, the index for cement rose 7.7 percent in January and 17.8 percent compared to a year earlier. That, in turn, fueled an increase in the index for concrete products of 1.8 percent for the month and 14.8 percent year-over-year.
Declining prices were seen in the producer price index for steel mill products, which slid 2.3 percent for the month and 30.1 percent over 12 months. The index for lumber and plywood was unchanged in January but fell 30.8 percent from a year earlier.
Association said that officials in Washington have left unanswered many questions about what materials qualify to be used on infrastructure projects funded by the Bipartisan Infrastructure Law.
“Unfortunately, more than 15 months after enactment of the infrastructure law, the administration’s guidance about materials is still confusing, contradictory, and incomplete,” said Stephen E. Sandherr, CEO, in a statement. “Uncertainty about eligible materials threatens to delay needed infrastructure projects and make them much more expensive.”
Source: AGC
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Rod Sutton
Sutton has served as the editorial lead of Construction Equipment magazine and ConstructionEquipment.com since 2001.
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