AGC: Construction input costs up in June

By |  July 18, 2022


Prices for nonresidential construction materials and services jumped 1.1 percent in June, outpacing the rise in contractors’ bid prices, according to an Associated General Contractors of America (AGC) analysis of government data.

Association officials warn that rising materials prices are having an adverse impact on a growing number of construction projects that have suddenly become more expensive.

“Some materials prices have fallen recently but others appear headed for further increases,” says Ken Simonson, AGC’s chief economist. “Since these prices were collected, producers of gypsum, concrete and other products have announced or implemented new increases. In addition, the supply chain remains fragile and persistent difficulties filling job openings mean construction costs are likely to remain elevated despite declines in some prices.”

The producer price index for inputs to nonresidential construction, the prices charged by goods producers and service providers such as distributors and transportation firms, jumped 1.1 percent from May to June and 16.8 percent since June 2021. Meanwhile, the index for new nonresidential building construction, a measure of what contractors calculate they would charge to erect five types of nonresidential buildings, climbed by 0.5 percent from May to June and 19.8 percent from a year earlier.

A diverse mix of inputs accounted for the increase in the cost index, even as prices for several metal and wood products declined, according to Simonson.

The price index for diesel fuel increased 14.1 percent in June and more than doubled year-over-year, rising 111.1 percent since June 2021. The index for asphalt and tar roofing and siding products rose 3.2 percent in June and 22.2 percent over the last 12 months. The index for plastic construction products rose 1.5 percent for the month and 27 percent since June 2021.

Insulation materials climbed 1.2 percent in price last month and 16 percent year-over-year. The index for concrete products rose 1.7 percent in June and 13.5 percent over the last 12 months. The index for paving mixtures and blocks increased 2.9 percent in June and 17.9 percent over June 2021.

These increases more than offset declines in indexes for metals and lumber. There were one-month decreases in June in the index for copper and brass mill shapes (down 1.6 percent), steel mill products (down 1.8 percent), aluminum mill shapes (down 5.2 percent) and lumber and plywood (down 14.7 percent).

AGC officials say public officials have a vested interest in taking steps to address rising materials prices, noting those price increases make it more expensive to build all manner of public infrastructure projects. They urge the Biden administration to remove remaining tariffs on a range of construction materials and for public officials at all levels to take steps to help unclog backed up supply chains.

“The more materials prices increase, the harder it will be for public officials to build new schools, roads and other infrastructure,” says Stephen Sandherr, AGC’s CEO. “Taking steps to address rising materials prices will help construction employers and taxpayers alike.”

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About the Author:

Jack Kopanski is the Managing Editor of Pit & Quarry and Editor-in-Chief of Portable Plants. Kopanski can be reached at 216-706-3756 or

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