Key Building Materials Prices Far Surpassed Inflation in 2016

Filed in Economics by on January 27, 2017 1 Comment

Softwood lumber, oriented strand board (OSB), ready-mix concrete and gypsum products all posted price changes in 2016 well above the 1.3% average for the Consumer Price Index, according to the latest Producer Price index released by the Bureau of Labor Statistics.

OSB prices surged 13.8% in 2016, while softwood lumber rose nearly 8.7%.  In November, the cost of ready-mix concrete and gypsum products rose 3.5% and 5.0%, respectively, on a year-over-year basis.

In an ominous sign, the price of softwood lumber rose by 2.3% in December, which is the largest monthly increase since April 2016.

A nine-year softwood lumber agreement between the U.S. and Canada that established a system of fees and quotas on Canadian imports to the U.S. triggered in response to changes in the market price of softwood lumber expired in Oct. 2015.

Negotiations on a new agreement have failed. U.S. lumber producers recently filed a petition with the International Trade Commission, reigniting a long-term trade battle between the two countries.

NAHB is fighting to ensure American consumers have access to a stable, dependable and affordable lumber supply.

For more information on materials prices, view this recent Eye on Housing blog post by NAHB economist Dave Logan.

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  1. Wayne Mayo says:

    There is no more sensitive market to supply and demand than the lumber market.

    Lumber doesn’t store well.

    We probably have a shortage of mills.

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