With a strong reading of 8.4 months of work under contract but not yet performed, as reported by Associated Builders and Contractors latest Construction Backlog Indicator, ABC believes the building industry is not likely to experience huge upswings in materials prices in the near future. But, the association's analysis of the U.S. Bureau of Labor Statistics' Producer Price Index data revealed that construction input prices did rise again for the month (+0.3%) and are up 1.9% year-over-year.

 
Nonresidential construction input prices had a slightly lower gain in the last 12 months (+1.8%) but were flat for the most recent month.

In individual subcategories, iron and steel (+2.8%) was the only one that saw a monthly increase greater than 1% but is down 11.9% for the year, one of six of the 11 subcategories that posted year-over-year declines.
"As predicted, construction materials prices are rising only gradually in the aggregate and have actually decreased in a number of categories," says ABC chief economist Anirban Basu. "America's shale revolution has kept both oil and natural gas prices low, even in the midst of ongoing global tumult. Natural gas prices have declined by more than 40% over the past year.

"The coronavirus outbreak is likely decreasing the demand for raw materials since so many supply chains have been interrupted," Basu adds. "While that should conspire to drive prices lower in a number of categories during the weeks ahead, there may be certain construction components that inflate in price due to those very same supply chain interruptions."