Associated Builders and Contractors (ABC) on Friday released its latest analysis of construction input prices. According to the group's analysis, the U.S. Bureau of Labor Statics' Producer Price Index data has improved since last year.
However, long term, ABC Chief Economist Anirban Basu said he expects elevated global container-shipping rates and emerging supply chain issues couple increase prices for contractors, who fear their profit margins will decrease over the next six months.
According to ABC:
- Construction input prices decreased 0.9% in September compared to the previous month.
- Nonresidential construction input prices also decreased 0.9% for the month.
- Prices decreased in two of the three energy subcategories last month:
- Crude petroleum prices were down by 16.7%, while unprocessed energy materials prices were down 12.6%.
- Natural gas prices rose 2.4% in September.
- Overall construction input prices are 1.9% lower than a year ago, while nonresidential construction input prices are 2.1% lower.
“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.” 
Construction input prices decreased 0.9% in September compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index dataABC
