Inputs to residential construction, goods less food and energy, increased for the fourth consecutive month to a new high, according to the most recent Producer Price Index (PPI) report published by the U.S. Bureau of Labor Statistics. The index for inputs to residential construction, goods less food and energy, represents building materials used in residential construction. The non-seasonally adjusted index increased 0.49% between January and February after increasing 1.27% between December and January. The average monthly change in the index in 2023 was 0.15% for comparison. In both 2022 and 2023, January featured the largest monthly increases for both years, 4.05% and 1.07% respectively. Over the year, the index was up 2.18%.
The seasonally adjusted PPI for final demand goods increased 1.20% in February, after decreasing a revised 0.12% in January. The PPI for final demand energy increased 4.35% in February, final demand food also rose 1.02%, and final demand goods, less food and energy, rose 0.31%. Despite the PPI for final demand goods increase in February, the index is only 0.25% higher than February 2023.
The seasonally adjusted PPI for softwood lumber fell for the seventh consecutive month, down 2.98% in February. Softwood lumber prices were 10.35% lower in February 2024 when compared to 2023. Prices for lumber will likely start to creep upwards as single-family home construction enters the spring season and demand for lumber increases.
The non-seasonally adjusted PPI for gypsum building materials jumped 2.95% in February after falling for ten straight months. The index was 0.18% lower than one year ago.
The seasonally adjusted PPI for ready-mix concrete rose 0.25% in February after rising 1.76% in January. Over the year, ready-mix concrete prices were 7.42% higher in February.
The non-seasonally adjusted PPI for steel mill products rose for the third straight month, up 2.86% in February. Steel mill product prices are 5.00% higher than last year.
