Building Materials Price Inflation: September 2002

Average construction material/supply prices rose by a slight 0.1% between August and September, following much larger gains over the prior two months. Prices for construction industry products increased at least a bit during each of the first nine months of 2002, following a decline of 0.9% between full-year 2001 and full-year 2002. Compared to September of last year, average prices received by U.S. manufacturers of construction supplies and materials during September 2002 were up by a cumulative 1.8% -- a relatively moderate rise, given the unrelenting upward trend experienced during the first three quarters of this year.

Overall lumber prices declined by 0.9% during September, the fourth time over the past five months that average prices have fallen. Consequently, the price index covering all softwood and hardwood lumber was 2.9% lower during September 2002 than it had been during the same month of 2001.

Gypsum product prices - which had soared by 7.8% between March and June - eased by 3.6% during the month of July and by 0.2% during September. Sandwiched in between, however, was a 1.4% price increase for this always-volatile product group. So average gypsum product prices this September were a steep 10.1% higher than during September of 2001 - after declining by an even-sharper 22.3% (on an annual average basis of measure) between 2000 and 2001.

Average prices were lower this September than during September 2001 for structural steel (-3.0%), lumber (-2.9%), ceramic floor & wall tile products (-2.4%), ready-mix concrete (-0.8%), flat glass (-0.7%), and asphalt/tar shingles (-0.7%). Prices had risen over the twelve months ending in September 2002 for gypsum products (+10.1%), unitary air-conditioning units (+2.4%), builders' hardware (+1.6%), plumbing products (+1.3%), paving asphalt (+0.7%), and hand/edge tools (+0.2%). The price composite covering the full range of construction materials and supplies was 1.8% higher this September than during September of 2001.