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Construction Material Costs—Spikes Everywhere

The breakouts in U.S. construction material input costs showed few signs of abating in March.

Table 1 presents year-over-year, and latest-three-month percentage-change results for 15 Producer Price Index series that bear on the materials cost side of construction projects. March 2022’s year-over-year percentage changes were in double digits in 13 of the 15 series; were +20% or more in 10 of the 15 series; and were +30% or more in 6 of the 15 series.

Beyond the big and not unexpected year-over-year energy-related cost jumps for diesel fuel (+63.8%), gasoline (+61.5%), and asphalt (+36.9%), the next greatest increases were recorded for steel bars, plates, and structural shapes (+45.4%), aluminum mill shapes (+43.7%) and particleboard and OSB (+36.8%). The energy-related cost climbs are tied to oil and gas supply interruptions and uncertainty created by the military action between Russia and Ukraine.

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