Construction input prices jump 24 %
By Jenn Goodman Dive Brief :
New data from the federal government sheds light on what most U . S . contractors already know : Materials prices are skyrocketing . Nonresidential construction input prices increased 23.9 % in May compared to the previous year , according to an Associated Builders and Contractors analysis of U . S . Bureau of Labor Statistics data released Tuesday . These input prices are 4.8 % higher than in April , ABC said in a release .
Dive Insight :
Basu said the surge in prices is probably temporary as suppliers work to boost capacity and bolster output , a dynamic that eventually results in a downward shift in prices .
“ Operations at input producers should also become smoother over time as staff is brought back and standard operating procedures are reestablished ,” he said .
In addition , all three energy subcategories registered significant year-over-year price increases . Crude petroleum has risen 187 %, while the prices of unprocessed energy materials and natural gas have increased 100 % and 90 %, respectively . The price of softwood lumber has expanded 154 % over the past year .
The elevated prices will not decrease anytime soon , said ABC chief economist Anirban Basu . “ While global supply chains should become more orderly over time as the pandemic fades into memory , global demand for inputs will be overwhelming as the global economy comes back to life .”
26 DITCHMEN • JUNE 2021