The National Association of Home Builders reports that construction goods input prices reversed course in September, increasing 0.2% after declining each of the prior two months. NAHB cites the latest Producer Price Index (PPI) release by the Bureau of Labor Statistics. The index for inputs to residential construction has risen 5.2% in 2018 and is 10.2% higher than it was in January 2017.
Gypsum prices also reversed trend in September, falling 0.1% (seasonally adjusted) after a combined increase of 6.1% over the prior two months. Since the start of the year, the price index for gypsum products has increased 1.0% per month, on average.
From January to September of 2017, prices paid for gypsum products rose 7.2%. The index has increased 8.1% over the same period in 2018.
The September PPI release continued to capture decreases in prices paid for softwood lumber that began in mid-June. However, even after accounting for the most recent price movements, the average price paid for softwood lumber in 2018 remains the highest on record according to Random Lengths data—18.7% above the prior record set in 1997.
The index for prices paid for OSB (and waferboard) decreased for the second consecutive month (-5.2%, not seasonally adjusted). Prices are down 16.4% since July and have declined in five of the past 12 months.
The index for ready-mix concrete (RMC) prices increased 0.4% (seasonally adjusted), reversing a four-month trend of price declines. After an uncharacteristically large monthly increase in March—when the index rose 3.3%–the PPI for RMC has fallen back in line with its long-run trend.