Construction Input Prices Rise in June, with Softwood Lumber up 11%

According to the Associated Builders and Contractors (ABC) analysis of the recently released U.S. Bureau of Labor Statistics (BLS) Producer Price Index (PPI), construction input prices increased 2.2% in June. As a point of reference non-residential construction input prices rose by 2.3% for the month. Of the 11 subcategories in the PPI six increased in the month of June. The increase in pricing was for the most part led by energy, with the biggest increasing coming from crude petroleum, which rose 71.9%. In comparison softwood lumber only increased by 11.0% in June.  ABC Chief Economist Anirban Basu, said, “While the recent rise in energy prices receives much of the attention, the price of softwood lumber is up nearly 19% over the past 12 months and was up 11% in June itself.” Basu also warns of the risks of inflation over the next 12 – 24 months and its impact on softwood lumber prices.