US Residential Building Materials Prices Little Changed in May

A closer look at the US Bureau of Labor Statistics (BLS) Producer Price Index (PPI) for May, with a focus on residential construction and additional analysis provided by the National Association of Home Builders (NAHB), reveals that inputs to residential construction, goods less food and energy, declined 0.09%.

The index for inputs to residential construction, goods less food and energy, represents building materials used in residential construction. The May report posted the first decline since October 2023, and while the index declined month-over-month, it was 2.91% higher year-over-year.

The NAHB breakdown by product is as follows:

• The seasonally adjusted PPI for softwood lumber fell for the first time since February, down 5% over the month. Prices for softwood lumber remain 8.10% below May 2023. It was the 19th consecutive month where the softwood lumber index was lower than one year ago.
• The non-seasonally adjusted PPI for gypsum building materials was unchanged over the month but was up 2.09% over the year. Price growth for gypsum building materials has slowed from the growth during the pandemic and has remained muted from about the second half of 2022.
• The seasonally adjusted PPI for ready-mix concrete fell for the second consecutive month, down 0.13% after falling from 0.9% in April. Ready-mix concrete remains well above last year’s level, up 5.65%.
• The non-seasonally adjusted PPI for steel mill products rose 0.54% after falling in the two previous months. Year-over-year, steel mill product prices were lower than one year ago for the third straight month, down 13.81%.
• The non-seasonally adjusted special commodity grouping PPI for copper rose 8.47% after rising 3.44% in April. Over the year, the index was up 17.14%.