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Construction price inflation continues in March

Post Time:Nov 12,2013Classify:Industry NewsView:41

AGC economist offers advice on coping with rising material costs Steel and diesel costs have skyrocketed in recent months, says Ken Simonson, chief economist for The Associated General Contractors of America, Arlington, Va. “The industry is seeing dramatic increases in steel costs. Prices are up as much as 50 percent from December. … Diesel costs are up 39 percent from a year ago.” The producer price index from the Bureau of Labor Statistics increased 2.2 percent for diesel fuel and 3.5 percent for steel in February, according to a March 18 AGC release. The March PPI will likely show even more increases, Simonson says. Glass companies feel diesel hikes directly, as they rely on diesel to fuel on-site equipment and trucks for deliveries. “Companies are also seeing fuel surcharges on their deliveries,” Simonson says. Glazing companies should keep a close eye on the markets and maintain good communication with suppliers and customers, Simonson says. “Glass companies may want to look at price adjustment clauses to ensure … that the risk is shared,” he says. AGC offers an alternative set of contract construction documents at www.consensusdocs.org that includes price adjustment clauses. Simonson would not give a detailed prediction of what’s to come, but did say, “given the soft economy and seemingly ample supply of things like petroleum and diesel, it’s possible prices will come down. However, a year ago, prices remained flat for most of the year. So, prices this year will be dramatically increased over last year, even if we don’t see further increases.” —By Katy Devlin,retail/commercial glasseditor for Glass MagazineShare this article:

Source: http://www.glassmagazine.com/news-item/commercial/construction-price-inflation-continues-marchAuthor:

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