Material costs going up, contractors say
The price of construction materials is rising again after a steady start to the new year, the Associated General Contractors of America said.
Citing an analysis of market information and producer price indexes, the association said prices for “construction inputs” - all materials used in construction plus items consumed by contractors - rose 0.4 percent from December to January and 4.5 percent overall during the past year.
“Cost increases have slowed in recent months but haven’t disappeared,” said Ken Simonson, the AGC’s chief economist. “In fact, today’s producer price index report may be the low point, as manufacturers and commodities markets are signaling that bigger increases may be just around the bend.”
Already, a number of commodities are seeing significant cost increases, Simonson added.
“Crude oil and diesel prices have moved up significantly since the January price index data were collected,” he said. “Producers of plastic pipe have notified customers of 8 percent increases, effective March 1. And copper futures have jumped from levels of a few weeks ago, making increases in pipe and wiring prices likely.”