Baking & Snack - September 2009 - 32

CONSTRUCTION REPORT

Foundations

Nickel

2500
2000
1500

30000
USD/tonne

Settling

Aluminium
3000
USD/tonne

36

20000
10000
0

1000

PORTLAND CEMENT ASSOCIATION/US DEPT. OF LABOR BUREAU OF LABOR STATISTICS

BAKING & SNACK / September 2009

USD/tonne

USD/tonne

Aug Dec Apr Jul
Aug Dec Apr Jul
After fundamental building materials such as steel suffered a
tumultuous period of years starting in 2004 and culminating
in 2008 with exorbitant price hikes, surcharges and restricted
Zinc
Tin
supply, the market has settled down quite a bit. Although con2000
30000
crete and lumber, two of the other most costly components of
industrial construction, were not as severely affected as steel,
20000
1500
reviewing their historic trends reveals a better understanding
10000
of the current costs and possible decisions by processors to
opt for new construction or to renovate existing structures.
0
1000
According to the US Department of Labor Bureau of Labor
Aug Dec Apr Jul
Aug Dec Apr Jul
Statistics and analysis by the Portland Cement Association,
Skokie, IL, steel prices declined for the 10th straight month.
▲After hitting record high prices last summer, prices of most
Although the May-to-June decrease was less than 1%, steel
metals for direct or indirect use in structural or mechanical
prices decreased 38.5% within the past year.
systems dropped significantly through December but have since
made steady increases and are at or near their highs for the year.
In contrast, steelmaking components have not dropped in
WWW.STEELONTHENET.COM; WWW.METAL-PAGES.COM
price as dramatically. According to a variety of sources compiled for the North American Steel Conference, base price for
iron ore increased 66% between 2007 and 2008, and has remained at the high ever since. Natural gas used
to process the components jumped 91% from $320 per 1,000 cu m in 2007 to $577 in 2008 but has since
come back down to $310. Coking coal jumped nearly 50% and remains there, while scrap steel rocketed
more than 100% in price per tonne in 2008 but returned to pre-2007 levels during the past eight months.
Finally, thermal coal exploded more than 250% from $55 to $193 per tonne. Prices as of June 2009 were
down to $76 per tonne.
Metals such as aluminum, copper, nickel and tin all dropped dramatically from August through December
of 2008. However, all except tin rebounded and experienced steady increases
through July.
Pricing for concrete, perhaps the material contributing the highest construction
cost, has been steadily increasing at a rate
of 4 to 5% per year, although since February, the producer price index decreased
2.0 points for an average price gain of 1.9%
during the past year.
Whether because of the decreased
housing market or other factors, lumber
prices significantly declined since 2006
and recorded a 15% decrease in the index
during the past 12 months.
The graph shows a comparison of four
major building materials as a single index
over time. The base year was 2002, when
▲ Within the past 12 months, the producer price index for steel building materials dropped
the indices for the materials were calibratmore than 100 index points from 246 to 144, although the rate of decent has slowed during
ed to equal 100.
the past 4 months. The steady rise in concrete prices since 2004 also peaked in January and
leveled off since March.


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Baking & Snack - September 2009

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Contents
Baking & Snack - September 2009 - 1
Baking & Snack - September 2009 - 2
Baking & Snack - September 2009 - 3
Baking & Snack - September 2009 - Contents
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