Construction materials

Prices of major building materials continue to rise in August as contractors struggle to get these products delivered on time

Construction officials call for immediate removal of tariffs on major building materials, urge Congress and administration to take action to fix ‘all levels’ of supply chain

The prices contractors pay for building materials continued to rise in August as many companies report difficulties getting these materials delivered on time, according to a analysis by the Associated General Contractors of America from government data released today. Association officials have urged officials in Washington to take action to help address challenges across the entire supply chain and causing prices to skyrocket.

“July was the seventh consecutive month of double-digit price increases for construction inputs,” said Ken Simonson, chief economist for the association. “In addition to the challenge, entrepreneurs find it difficult to pass even a fraction of these additional costs on to their customers. ”

The producer price index for new non-residential construction – a measure of what contractors say they would charge to erect five types of non-residential buildings – has risen 5.6% in the past 12 months. This was just over a quarter of the 20.6% increase in prices that producers and service providers such as distributors and transportation companies charged for construction inputs, Simonson noted.

There have been double-digit percentage increases in the selling prices of materials used in all types of construction. The producer price index for steel products rose 123 percent from last August. The lumber and plywood index has jumped 15.9 percent in the past 12 months. The index of copper and brass rolling mill shapes increased by 45.3% and the index of aluminum rolling mill shapes increased by 35.1%. The index of plastic construction products rose 29.6%. The index for gypsum products such as wall panels climbed 22.9 percent. The insulation materials index increased by 17.2%, while the index of prepared asphalt and tar roofing and coating products increased by 15.8%.

In addition to increasing material costs, transportation and fuel costs have also increased. The road freight transport index jumped 14.1%. Fuel costs, which contractors pay directly to operate their own trucks and off-road equipment, as well as surcharges on freight deliveries, have also jumped.

Association officials added that a investigation construction companies published by the association last week found that most contractors were experiencing delays in deliveries of many types of building materials. Association officials have urged the Biden administration and Congress to take action to improve the supply chain and fight price inflation, including removing tariffs on major building materials.

“Contractors have to pay more for materials even as it becomes more difficult to predict when these supplies will appear,” said Stephen E. Sandherr, CEO of the association. “Removing unnecessary measures that artificially inflate the cost of key materials, such as tariffs, will help employers struggling to cover the costs of inflation and uncertainty.”

Consult the producer price index The data. Seen graphic difference between input costs and bid prices. Consult the association Inflation warning in construction.

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