The price of construction materials rose in February due to an increase in items used in new housing and residential building renovations, according to analysis of federal data by the Associated General Contractors of America (AGC).
“For the second month in a row, contractors endured outsized price hikes for gypsum wallboard, lumber and insulation materials,” said Ken Simonson, AGC’s chief economist. “In addition, soaring diesel prices mean contractors are paying more for fuel they buy and, via fuel surcharges, for the thousands of deliveries of materials and equipment required for construction projects.”
The producer price index for all construction inputs rose 1.3 percent between January and February, equaling the entire increase for 2012, Simonson noted. The index was 2 percent higher than in February 2012, outpacing the increase in the price contractors are able to charge for most types of new buildings. The index for new office construction rose only 1 percent in the past year; new school buildings 1.2 percent; new industrial construction, 1.3 percent; and new warehouses, 2.6 percent.
The producer price index for gypsum products such as wallboard and plaster climbed 4.4 percent in February, following an 11.8 percent leap in January, for a cumulative rise of 17.8 percent over the past 12 months, Simonson noted. Lumber and plywood prices rose 2.3 percent in February and 15.8 percent from a year ago. Insulation prices increased 2.1 percent and 5.9 percent, while the price index for diesel fuel jumped 7.2 percent for the month and 3.8 percent year-over-year.
Prices for metals and paving materials showed mixed patterns, Simonson pointed out. Copper and brass mill prices rose 0.7 percent for the month but remained 2.1 percent below year-ago levels. Similarly, aluminum mill prices climbed 0.6 percent in February but slipped 1.5 percent over 12 months, while the price index for steel mill products dropped 0.9 percent and 9.7 percent, respectively. Asphalt paving prices retreated 0.1 percent for the month but edged up 1.1 percent over 12 months, while concrete prices increased 0.3 percent and 2.3 percent, respectively.