Construction material prices fell 0.9% in September and are down 1.9% on a year-over-year basis, according to Associated Builders and Contractors. Prices in August were 38.5% higher than in February 2020.
Nonresidential construction material prices fell 0.9% from August to September and decreased 2.1% compared with one year ago. Softwood lumber prices are down 2.2% year over year and up 2.5% from August to September. Iron and steel prices are down 9.2% year over year and 1% for the month. Natural gas rose 2.4% from August to September and fell 24.8% year over year. Crude petroleum fell 16.7% for the month and is down 27.8% year over year.
“The decline in construction input costs observed in September was almost entirely due to a large decrease in oil prices,” said ABC Chief Economist Anirban Basu. “Certain materials, like gypsum, fabricated structural-metal products, asphalt and lumber exhibited sizable price increases for the month. While domestic freight rates are low by historical standards, elevated global container-shipping rates and emerging supply chain issues could put upward pressure on materials prices in the coming months. This represents a cause for concern for contractors, many of whom expect their profit margins to contract over the next six months, according to ABC’s Construction Confidence Index.”
