The producer price index (PPI) for finished goods rose 0.2% in February, not seasonally adjusted (0.3% adjusted), and 6.4% over 12 months, the Bureau of Labor Statistics (BLS) reported on Tuesday. The unadjusted PPI for inputs to construction industries climbed 0.6% and 5.5%. Inputs to highway and street construction rose 0.7% and 11.3%; other heavy construction, 1.1% and 8.5%; nonresidential buildings, 0.6% and 5.6%; multi-unit residential, 0.3% and 3.7%; and single-unit residential, 0.5% and 2.8%. Significant contributors to the varying results included diesel fuel, up 2.2% and 48%; copper and brass mill shapes, 5.8% and 14%; hot-rolled steel bars, plates and structural shapes, 3.5% and 12%; asphalt paving mixtures and blocks, 0.6% and 3.7%; concrete products, 0.4% and 2.5%; insulation materials, down -0.1% and -3.9%; lumber and plywood, -0.2% and -5.8%; and gypsum products, -0.2% and -20%.
“Steel producers are reporting an unprecedented price spiral at a time of lackluster domestic demand, beckoning higher costs for everything from refrigerators to new office towers during a period of economic weakness.,” Econoplay (www.econoplay.com) reported on Thursday. “The pricing gallop has been dizzying, soaring in excess of 50% for several benchmark products since hitting a cyclical trough last summer, toppling old records in recent weeks. Domestic steel prices are now at the mercy of fast-rising import prices that are subject to global supply constraints, strong demand outside the United States, and stockpiling ahead of more predicted price increases….U.S. steel producers are running mills at full tilt as they win new foreign customers outside the traditional bounds of Canada and Mexico for the first time in living memory. They’re also filling the gap left by foreign producers that have shied away from the U.S. market….John Cross, vice president of marketing for the American Institute of Steel Construction,...discovered a spike in the number of respondents seeing construction jobs put on hold-26% this quarter [in his latest survey of members] versus just under 15% in the fourth quarter….Cross views the commercial construction downturn as ‘spotty,’ seeing offsetting strength in energy-related and industrial projects, healthcare, and hotels and resorts-the latter a beneficiary of the cheap dollar, which draws in foreign tourists while keeping U.S. travelers closer to home. ‘A lot of steel is rolling into Las Vegas,’ he said, pointing out that steel production in January was higher than in any other month in history.” AGC has received numerous reports of recent and pending steep hikes for electrical steel, strand, anchors, wedges, studs, structural, carbon and alloy steel plate.
New construction starts in February advanced 2% from January, McGraw-Hill Construction reported on Tuesday, based on its own data collection. “The gain for total construction reflected a strong performance by nonresidential building, which for the second month in a row was boosted by groundbreaking for several very large projects. At the same time, nonbuilding construction (public works and electric utilities) fell back from January’s elevated pace, and residential building dropped further as its lengthy correction continues. For the first two months of 2008, total construction on an unadjusted basis [was] down 18% from the same period a year ago. If residential building is excluded, the value of new construction starts during the first two months of 2008 increased a slight 1% compared to last year.”
Census data released on Thursday “show a marked deceleration in population growth in several suburban counties that are farthest from urban centers-the kind of counties to which some city residents had flocked in prior years for bigger houses and a different lifestyle,” the Wall Street Journal reported on Thursday. “At the same time, urban areas and close-in suburbs were seeing population decreases slow, and in some cases reverse.” Events like Hurricane Katrina in September 2005 can affect rankings temporarily, but extended changes provide hints about demand for various types of construction. From July 2006 to July 2007, the largest percentage increases were in two Louisiana parishes (counties) that lost the most a year earlier: St. Bernard, 43% and Orleans, 14%; followed by Pinal, Arizona (near Phoenix), 11.5%; Kendall, Illinois (Chicago area), 10.6%; Rockwall, Texas (Dallas area), 8.2%; Flagler, Florida (between Daytona Beach and Jacksonville), 7.2%; Union, North Carolina (near Charlotte), 7.2%; and three Georgia counties: Forsyth (7.2%), Paulding (6.7%), both near Atlanta, and Jackson (6.7%), bordering on Athens-Clarke County. Looking at 2000-07 combined, Mark Mather of the Population Reference Bureau (www.prb.org) commented, “Fast-growth counties are most concentrated in the southern and western United States, especially in Florida, interior California, parts of Nevada, Arizona, Colorado, and Utah, and in the suburbs and exurbs of large metropolitan areas, such as Atlanta and Washington, D.C. The biggest…declines are in the rural Midwest, Upper Great Plains, and Mississippi Delta region, including New Orleans.”
“After 14 straight years of rapid growth in high school graduate numbers, the U.S. will top out this year,” the Western Interstate Conference for Higher Education (www.wiche.edu) reported on Thursday. “Beginning in 2008-09, projections point to a gradual, downward trajectory for the nation, with graduate numbers falling to their lowest point around 2013-14 and then slowly rising….Between the peak year of 2007-08 and 2021-22, the Northeast’s high school graduate numbers will shrink by 13%,…the Midwest’s will drop by 7%. But the West will see growth of 5%, and the South will see double that. Nationally, the number will rise by 6%.” The website includes trends by demographic group for each state. The data have implications for future demand for high school and college construction and workforce availability