Producer Price Index of Materials Inputs to Construction. The 1st two plots are PPI Final Costs. All other plots are PPI Input costs. Changes in PPI Input costs at the producer level may not reflect changes in actual pricing to contractors or changes in final cost as installed to building owner. Cost do not reflect retail markup or mark down and do not reflect overhead and profit markups that may change according to market activity.
PPI for Construction Inputs IS NOT an indicator of construction inflation. It does not represent selling price, the final cost of materials put-in-place which includes cost of labor, overhead and profit.
More commentary will be added soon.
Specific Building and Contractor PPI Indices are Final Demand or Selling Price indices. They are plotted above.
Bureau of Labor Statistics Producer Price Index measures PPI cost of materials price at producer level. The PPIs that constitute Table 9 of the BLS PPI Report measure changes in net prices for materials and supplies typically sold to the construction sector, but do not represent the final cost installed. They are known as PPI Inputs. They are plotted below.
Here’s a brief summary of some of the PPI statistics tracked here:
- One year (2017) change
- biggest increases > Diesel fuel, Scrap Steel, Copper and Aluminum Mill Shapes, Steel Pipe, Lumber & Plywood
- smallest increases > Insulation, Brick, Sheet Metal, Asphalt Roofing, Ornamental Metals, Structural Steel
- only declines > Fabricated Steel Bar Joists and Rebar, Asphalt Paving
- Two year (2016+2017) changes
- biggest increases > Diesel fuel, Steel Scrap, Copper and Aluminum Mill Shapes, Steel Pipe, Lumber & Plywood, Gypsum Products
- smallest increases > Asphalt Roof Coatings, Brick, Precast Concrete, Insulation, Sheet Metal, Steel Bar Joists & Rebar, Flat Glass
- Only decline > Asphalt Paving
- Three year (2015>2017) changes
- biggest increases > Cement, Readymix Conc, Flat Glass, Gypsum Products
- smallest increases > Sheet Metal, Structural Steel, Steel Joists & Rebar, Brick
- biggest declines > Asphalt Paving, Steel Scrap, Steel Pipe, Asphalt Roofing, Diesel Fuel
Most stable pricing over last 5 years, these items did not change by more than 4%/yr in any given year during the last 5 years and net the smallest total change for 5 years: Asphalt Roofing -1% in 5 years, Fabricated Structural Steel +3.4%, Sheet Metal+2.7%, Building Brick +7%.
The indices plots above are generated by indexing the December to December percent changes in the table below. All data updated to include Dec 2017 published January 2018.