According to the latest Producer Price Index (PPI) report released by the Bureau of Labor Statistics, the prices of goods used in residential construction ex-energy (not seasonally adjusted) climbed 0.5% in April, following upwardly revised increases of 1.9% and 2.4% in March and February, respectively.
This adds up to an 4.9% increase in building materials prices since the start of 2022. Building materials prices are up 19.2% year over year and have risen 35.6% since the start of the pandemic.
Specific material increases include:
- Softwood lumber: The PPI for softwood lumber (seasonally adjusted) declined 15.6% in April, following a downwardly revised 5.4% increase in March and a 2.5% gain in February. As a result, the index is down 8.9% over the first four months of 2022. Since reaching its most recent trough in September 2021, prices have risen 60.4%.
- Steel products: Steel mill products prices (not seasonally adjusted) climbed 2.4% in April — the first monthly increase since December 2021. Nonetheless, the first four months of 2022 have been positive for the cost of derivative steel products after increasing 128% in 2021.
- Ready-mix concrete: The PPI for ready-mix concrete (RMC) prices rose 1.3% (seasonally adjusted) in April after a small decline in March. The index has climbed 8.9% year over year and is 12.6% higher than the January 2021 reading.
- Gypsum products: The PPI for gypsum products (seasonally adjusted) was flat in April. The prices of gypsum products are up 17.8% year over year and have increased 23.5% since January 2021.
David Logan. NAHB director of tax and trade policy analysis, provides more in this Eye on Housing post.