According to a recent analysis conducted by trade group Associated Builders and Contractors of information provided by the U.S. Bureau of Labor Statistics, the pricing of construction materials has remained relatively flat from June to July 2023, but Owner and Contractors alike can take comfort in knowing even this levels represents a sharp decrease from the peaks of 2021 and 2022.
Covid-19, and its ensuing impacts on the global supply chain, created an unprecedented rise in materials pricing beginning in early 2020 and carrying through the better part of 2022. While current prices remain notably higher than their February 2020 counterparts, they have mostly plunged from the peaks of 2021 and 2022.
Among those most affected are Steel Mill Products (+70.5%), Iron and Steel (+55.9%), Gypsum Products (+41.9%) Lumber and Wood Products (+26.9%), and Switchgear, Switchboard and Industrial Controls Equipment (+37.0%).
However, while prices have not returned to pre-Covid levels, a review of the previous 12 months of pricing reveals a sharp decline. Among the biggest moves are Natural Gas (-72.5%), Steel Mill Products (-20.9%), and Softwood Lumber (-17.3%).
Though not all costs have decreased in kind. Among the highest increases year-over-year have been Concrete Products (+9.6%) Construction Machinery and Equipment (+9.3%) and Switchgear, Switchboard, and Industrial Controls Equipment (+8.4%).
It remains to be seen whether pricing will remain flat or continue its gradual reversion to the mean. We will keep you updated monthly as things progress.
