The average price of commonly used construction materials increased by nearly 1% from March to April, a prominent construction group reported on Thursday.
The Associated Builders and Contractors reported that construction inputs were 0.9% percent more expensive in April than in the previous month and 2.4% more expensive than in April 2018.
Anirban Basu, ABC chief economist, said the rise was driven mostly by higher energy costs.
“In particular, the price of oil mainly rose for political reasons, and therefore is not an indication that materials prices will aggressively increase,” Basu said.
Of the 11 types of construction inputs tracked by the ABC, seven rose in price in April. The largest month-over-month increases were seen for crude petroleum (up 13.9%), unprocessed energy materials (up 3.7%), prepared asphalt products (up 2.7%) and concrete products (up 1.1%). The biggest decreases, meanwhile, were for natural gas (down 8.7%), iron and steel (down 1.7%) and steel-mill products (down 1.7%).
April was the third consecutive month that input prices increased on average. Basu pointed out that, although prices have been on the rise, the increase since April 2018 has been only of 2.4%. That’s only slightly higher than rate of inflation and slightly lower than the average rate of wage increases in the same period.
“With much of the global economy slowing and given ongoing trade tensions between American and Chinese policymakers, it’s likely materials price increase will remain modest going forward, even in the context of a robust nonresidential construction sector,” Basu said.