Commodity price check: Plywood falls
The PPI index for Plywood dropped 5.7 percent compared to the same month a year ago. But the nine-other key hardware and building supply commodities showed increases from 1% to 9.5%.
That’s the latest data from the U.S. Bureau of Labor Statistic’s Producer Price Index report.
From December to January, softwood lumber was again the most volatile commodity on the list of 10, down 4.7 percent.
(The most volatile across the entire list? Once again it’s eggs. “Eggs for fresh use” rose 186.4 percent unadjusted, compared to January 2024.)
Analysis from the Associated Builders and Contractors, a Washington, D.C.-based trade group, shows construction input prices increased 1.4% in January compared to the previous month.
“Materials prices increased at the fastest monthly pace in two years in January,” said ABC Chief Economist Anirban Basu. “This rapid escalation is largely due to three factors. First, energy prices rose sharply. Second, producers often raise their prices at the start of the year. And third, many purchasers rushed to buy inputs before potential tariffs could go into effect, and that surge in demand pushed prices higher.”
“Of these three factors, tariffs are the only one that could continue to push input prices higher in the coming months,” said Basu. “Import taxes allow domestic producers to raise their prices, and the new 25% levies on steel and aluminum will result in just that if they remain in place. A strong majority of contractors expect their sales to increase over the next six months, according to ABC’s Construction Confidence Index, and the combination of increased demand for construction inputs and ongoing supply chain confusion suggests input price escalation could accelerate through the first half of 2025.”
Overall construction input prices are 1.3% higher than a year ago, while nonresidential construction input prices are 0.7% higher. Prices increased in all three energy subcategories last month. Crude petroleum prices increased 14.8%, while natural gas and unprocessed energy material prices increased 13.7% and 13.0%, respectively.
