Chicago Construction News staff writer
Construction input prices increased 0.7% in January compared with December, driven in part by tariffs on key materials, according to an Associated Builders and Contractors (ABC) analysis of U.S. Bureau of Labor Statistics Producer Price Index data released Friday. Nonresidential construction input prices rose 0.6% for the month.
On an annual basis, overall construction input prices are 2.3% higher, while nonresidential input prices are up 2.9%. Energy prices were mixed in January: crude petroleum and unprocessed energy materials rose 1.8% and 0.4%, respectively, while natural gas prices fell 2.9%.
“Nonresidential construction input prices rebounded in January, surging at a blistering 7.1% annualized rate for the month,” said Anirban Basu. “Much of the increase reflects higher costs for tariff-affected products such as copper wire and cable, iron and steel, and industrial controls equipment. Still, aggregate input price escalation remains moderate, with nonresidential materials prices rising just 2.9% over the past year and virtually flat since September.”
Basu added that trade policy could continue to put upward pressure on certain materials, particularly those subject to Section 232 tariffs, but energy prices and subdued demand are likely to keep overall input escalation in check. Contractor sentiment also showed modest improvement in January, with optimism regarding profit margins rising, according to ABC’s Construction Confidence Index, though confidence remains below last year’s levels.
The January data highlights the ongoing influence of tariffs on construction materials, even as broader price growth for nonresidential construction inputs remains relatively stable.
