The producer price index (PPI) report from the Bureau of Labor Statistics (BLS) stated that construction materials prices rose 0.3 percent month-over-month in August on a seasonally adjusted basis. The intermediate demand index of components and materials for construction was up 2.7 percent from its year-earlier level.
After being up a revised 0.7 percent last month, overall prices for processed goods for intermediate demand were up 0.4 percent this month. The overall processed goods for intermediate demand index was 2.6 percent higher than its year-earlier level.
For reference, the changes in these indexes compare with a 0.2 percent month-over-month rise and a 2.7 percent year-over-year rise in the seasonally adjusted all-items consumer price index (CPI-U) in July. The August CPI figure will be released September 11.
Yield Pro compiled the BLS reported changes for our standard list of construction materials prices. These are prices of materials which directly impact the cost of constructing an apartment building. The first two right hand columns of the table provide the percent change in the price of the commodity and the percent change in price from July (1 Mo PC Change) and from a year earlier (12 Mo PC Change). If no price data is available for a given commodity, the change is listed as N/A.
The pre-COVID column lists the change in the current construction materials prices relative to the average of prices from December 2019 through February 2020, before the pandemic impacted the economy. This provides a longer-term view of construction materials price trends.
| Commodity | 1 Mo PC Change | 12 Mo PC Change | Pre-covid Change |
| Softwood lumber | 0.6 | 5.2 | 17.8 |
| Hardwood lumber | 0.5 | 6.2 | 39.0 |
| General millworks | (0.0) | 2.0 | 33.6 |
| Soft plywood products | (0.1) | (2.2) | 52.0 |
| Hot rolled steel bars, plates and structural shapes | 4.3 | 6.5 | 55.0 |
| Copper wire and cable | (3.8) | 13.8 | 58.7 |
| Power wire and cable | N/A | N/A | N/A |
| Builder’s hardware | 0.1 | 10.0 | 37.2 |
| Plumbing fixtures and fittings | 0.0 | 9.0 | 30.6 |
| Furnaces and heaters | 1.2 | 9.3 | 50.1 |
| Sheet metal products | 0.1 | 4.4 | 54.4 |
| Electrical Lighting fixtures | N/A | N/A | N/A |
| Nails | (0.8) | 2.7 | 21.6 |
| Major appliances | (0.6) | 1.4 | 24.0 |
| Flat glass | 0.4 | 5.0 | 40.0 |
| Ready mix concrete | 0.1 | 0.0 | 37.4 |
| Asphalt roofing and siding | 2.2 | 6.1 | 48.8 |
| Gypsum products | 0.0 | 0.9 | 49.0 |
| Mineral wool insulation | (0.2) | (0.7) | 48.3 |
| CPI-U (unadjusted July) | 0.2 | 2.7 | 25.3 |
The prices used by the BLS in compiling the indexes are collected on the Tuesday of the week containing the 13th day of the month. In August that would have been August 12. In the September report, the data collection date will be September 9.
The first chart, below, shows the price index history for wood products over the past 37 months.
The softwood lumber price index rose this month after 4 months of declines. It was up 0.6 percent. It is now down 8.7 percent from its recent high in March but up 8.3 percent from its recent low in July 2024.
The hardwood lumber price index was reported to rise 0.5 percent this month, but last month’s index was revised higher by 0.2 percent for a total rise of 0.7 percent.
The soft plywood price index was reported to fall 0.1 percent this month, but last month’s index was revised lower by 0.3 percent for a total drop of 0.4 percent.
The next chart, below, shows the recent history of several other construction materials prices. These are relatively simple commodities whose prices are strongly driven by those of the materials of which they are comprised.
The price index for hot-rolled steel bars was reported to jump 4.3 percent this month. This was aided by a 1.6 percent downward revision being made to last month’s price index. This index is up 8.8 percent over the last 3 months.
The price index for copper wire was reported to fall 3.8 percent this month, reversing much of last month’s increase. Still, this index is up 2.6 percent over the last three months and up 14.1 percent from its recent low in December 2024.
For the third consecutive month, no price index was reported for power wire.
Price changes for several of the more finished goods from our sample are illustrated in the final chart, below.
The price index for plumbing fixtures and fittings was reported to be unchanged for this month. However, last month’s index was revised higher by 3.5 percent. This index is up 4.3 percent over the last 2 months.
The price index for major appliances fell 0.6 percent for the month, reversing last month’s increase.
After being nearly flat for the prior year, the price index for furnaces and heaters has been rising steadily since April. It added another 1.2 percent this month bringing its rise since March to 8.9 percent.
The full current BLS report can be found here.
