Construction material prices decreased 1.8% in July but are up 17.4% on a year-over-year basis, according to www.abc.org.
Nonresidential construction material prices fell 1.8% from June to July but increased 17.3% compared with one year ago. Prices fell in eight of 11 subcategories. Softwood lumber prices are down 7% year-over-year and up 0.8% from June to July. Iron and steel prices are up 2.8% year-over-year and down 4.4% for the month. Natural gas fell 27.6% from June to July and is up 275.6% since February 2020. Crude petroleum fell 19.1% for the month and is up 96.4% since February 2020.
“Today’s Producer Price Index data supplies additional evidence that inflation has peaked,” said ABC Chief Economist Anirban Basu. “A weakening global economy and ongoing supply chain adjustments have resulted in significant declines in the prices of a number of key commodities, ranging from oil to steel. While the risk of recession remains elevated, recent government reports on consumer and producer prices make it more likely that the Federal Reserve will be able to engineer a soft landing or that any recession to come could be quite mild. For contractors who have seen their profit margins diminished by elevated materials prices, a trend confirmed by ABC’s Construction Confidence Index, this is a welcome development.”