Building Materials Price Inflation - April 2000

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The Labor Department’s construction materials composite price index rose by 0.4% between February and March of this year. This brought the March 2000 composite index to a level 2.4% above its reading for the third month of 1999.

May 08, 2000
  Jan-00 Feb-00 Mar-00 Annual % Change

1999
Annual % Change

2000
Annual % Change

2001
Total Construction Materials 143.9 144.4 145.0 1.0 1.4 1.7
Lumber 188.2 189.1 188.0 4.8 2.8 3.4
Structural Steel 141.8 141.8 142.0 1.5 2.5 1.6
Gypsum 227.5 229.9 221.5 17.1 5.5 3.0
Concrete 145.0 144.7 145.2 2.6 2.2 2.5
Roofing 93.8 93.7 93.7 -1.0 1.3 0.6
Ceramic Tile 133.6 133.5 134.4 0.4 -0.7 0.5
Historical Data: U.S. Bureau of Labor Statistics

Forecast: Professional Builder

The Labor Department’s construction materials composite price index rose by 0.4% between February and March of this year. This brought the March 2000 composite index to a level 2.4% above its reading for the third month of 1999. On an annual average basis, the construction materials price index moved up 1.0% between 1998 and 1999 after declining by 0.5% over the previous year, so the current inflation rate represents a significant acceleration above the 1998-1999 trends.

After the inflation rate for gypsum products soared more than 17% higher during 1999, prices finally stabilized during the first quarter of this year. The price index for this volatile product group fell 3.7% between February and March, following no change in the first month of the new year and only a modest increase during February. Average prices this March were 11.8% higher than in March 1999 -- still a significant increase, but well below the 23.1% gain registered between December 1998 and December 1999.

Average lumber prices also moved lower during March after rising steadily throughout most of the past year. The 0.6% February-to-March dip left average lumber prices just 1.1% higher this March than during March 1999. Lumber prices during the first quarter of this year were 3.7% above the first-quarter 1999 level, after rising by an average of just under 5% for full-year 1999.

Average roofing material prices were unchanged in March, but declined by 0.2% between the final quarter of 1999 and the first quarter of this year - despite the impact of higher oil prices on the cost of producing asphalt shingles. Prices during the first three months of 2000 averaged 1.6% more than over January-March 1999. The average price for fabricated structural metal used in building construction was 0.8% higher during the first three months of 2000 than during the fourth quarter of last year. Inflation in metal product prices continues to accelerate - modestly, but steadily - with the first quarter average this year 3.0% higher than during the first three months of 1999 -- after registering only modest inflation of 1.5% for full-year 1999.

Average ready-mixed concrete prices have also begun to rise at a faster annual rate. Prices rose 0.3% between February and March of this year, and ended the first quarter of 2000 0.9% above their level in the final three months of 1999. Even ceramic tile product prices have started to show a little bit of inflation, rising an unusually sharp 0.7% between February and March. Tile prices were up a marginal 0.4% over full-year 1999, after falling sharply the year before and being essentially flat throughout 1996 and 1997. However, average tile prices during March of 2000 were already 0.4% higher than during the final months of 1999.

Also See:

Housing Starts

Consumer Confidence by Region

New Residential Building Permits by Region

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