Chart: Building Materials Costs Rise, Concrete Soars
After four consecutive declines, the producer price index (PPI) for inputs to residential construction less energy (i.e. building materials) rose 0.9% in January 2023 (not seasonally adjusted) according to the latest PPI report.
Price growth of goods inputs to residential construction, including energy, gained 1.4% over the month. Prices have increased 5.1% over the past 12 months.
The trend of ready-mix concrete (RMC) prices continued its historic pace as the index increased 0.9% in January after surging 13.6% in 2022. RMC prices have increase in all but two months since January 2021.
Gypsum Building Materials
The PPI for gypsum building materials was unchanged in January, following a 0.2% decline in December 2022. Gypsum products prices are 11.1% higher than they were a year ago but began stabilizing in August 2022. In the five months since, prices have been essentially unchanged.
The PPI for softwood lumber (seasonally adjusted) fell 7.6%–the sixth straight monthly decline. Over that period, the index has decreased 23.3%.
Steel Mill Products
Steel mill products prices decreased 2.3% in January after falling 3.3% in December 2022. Although the pace of declines has slowed, prices have dropped 27.8% since May 2022 and are down 30.1% over the past 12 months.