Construction input prices increased 0.2% in September, marking the fifth straight monthly increase, according to an analysis of U.S. Bureau of Labor Statistics data by the Associated Builders and Contractors (ABC). Nonresidential construction input prices also rose 0.2% for the month.
Compared to one year ago, overall construction input prices are 3.5% higher, while nonresidential construction input prices have risen 3.8%. Bucking the trend, prices in all three energy categories declined in September. Natural gas prices fell 8.7%, unprocessed energy materials were down 3.0% and crude petroleum prices decreased 1.7%.
“Construction input prices rose for the fifth straight month in September,” said Anirban Basu, ABC Chief Economist. “While that represents the longest streak of monthly increases since the first half of 2022, those increases are relatively modest. Materials prices have risen at a 3.2% annualized rate since April, a rate that is faster than ideal but nowhere near the escalation that occurred in 2021 and 2022.”
Basu notes that uncertainty remains regarding the future impact of tariffs on key industrial materials.
“Unfortunately, it’s unclear how higher tariffs on key materials like iron and steel and aluminum and copper will affect prices over the next several months, and it’s noteworthy that commodities related to those materials have exhibited significant year-over-year price increases,” he said. “Despite the prospect of ongoing materials price escalation, contractors remain cautiously upbeat about their profit margins and sales over the next six months, according to ABC’s Construction Confidence Index.”
