Material prices increase as construction cuts loom
“Contractors had to contend with huge leaps in prices for gypsum, wallboard and lumber, as well as significant increases in the cost of insulation and architectural coatings such as paint,” said Ken Simonson, chief economist for the construction trade association. “Based on pump prices for diesel fuel and price announcements by various manufacturers, it is clear that costs are rising significantly higher in February.”
The producer price index for what contractors pay for construction materials rose 0.7 percent between December and January and is now up 1.3 percent compared with 12 months ago, Simonson said. He added that bid levels for finished structures rose at comparable rates during the past year. The index for new school buildings rose 0.9 percent; new industrial construction, 1.4 percent; new office construction 1 percent and new warehouses, 2.9 percent.
Insulation prices went up 2 percent in January and 5.4 percent for the year, while the index for architectural coatings increased 1.1 percent for the month and is up 0.5 percent for the year.
Diesel fuel costs rose 0.7 percent in January but fell 1 percent from a year ago. Copper and brass mill prices rose 0.6 percent and 2.9 percent, respectively. Aluminum mill prices increased 0.3 percent in January, but have gone down 0.1 percent during the past 12 months, while the price index found that steel mill products slid 0.1 percent and 8.3 percent.