AGC Data DIGest: February 7-11, 2022

GAC job the February 2022 edition of its construction inflation warning on Wednesday. The document is intended to inform owners, officials and others of recent developments affecting material costs, supply chains, wages and worker availability.

The prices and availability of construction inputs show varied trends. The price of hot-rolled coils has fallen 39% in the past five months, returning to levels a year ago, Steel Market Update reported on Wednesday. Delivery times have also fallen sharply, implying further reductions. However, it is unclear how soon this will translate into lower prices or delivery times for structural steel products. The American Chemistry Council reported today that supplies of chlorine and ethylene, which are ingredients in many building plastics, continue to be tight, with continued reduced capacity resulting from hurricane damage in Louisiana. Ida last August. Reportedly, some chemical shipments by rail and truck are being replaced by non-hazardous material shipments which have fewer requirements for shippers. For titanium dioxide (TiO2), the bleaching agent for paints and other coatings, major supplier Chemours Co. reported today, “ore constraints continue into 2022, alongside commodity inflation, logistical challenges and broader customer supply chain issues.” The average retail price of on-road diesel fuel climbed 10 cents per gallon this week to $3.95, up $1.15 (41%) from a year ago and the highest since 2014 , the Energy Information Administration reported Monday.

There are signs that some parts of the supply chain are improving, but it’s too early to tell if the improvement will last. “The number of container ships queuing to enter the ports of Los Angeles and Long Beach fell to 78 ships on Tuesday, from the peak of 109 ships reached a month earlier, according to the Marine Exchange of Southern California,” said the Wall Street Journal. reported today. “Port officials say it is unclear whether the decline, which has accelerated over the past week after a surge shortly before and after the December holidays, is the start of a trend or a temporary respite from factory slowdowns in Asia for the Lunar New Year holiday which began Feb. 1… Although ship backup was the weakest since Nov. 11, congestion remains severe by historic standards Container ships wait an average of 18 days to unload at the Port of Los Angeles, the busiest of nearby gateways.Before the pandemic, it was unusual for ships to wait for a berth… The company’s specialists Denmark-based maritime consultancy Sea-Intelligence ApS say that based on previous ship backups, it could take eight or nine months to clear the backlog of ships once operations run more efficiently. ically. They have yet to see clear signs of progress.

“The Dodge Momentum Index fell 7% in January to a four-month low,” Dodge Construction Network reported Monday. The index “is a monthly measure of the initial report for non-residential construction projects in planning, which have been shown to lead construction expenditure for non-residential buildings for a full year. In January, commercial planning fell by 9% and institutional planning by 1%. The Dodge Momentum Index had a stellar 2021, rising 23% from 2020 and reaching levels not seen in nearly 14 years. However, the recent string of declines can be blamed on rising costs, logistical issues and skilled labor shortages. Yet, even though it has declined, the dollar value of projects in planning remains exceptionally strong, especially for education, warehouse and healthcare projects. The commercial sub-index fell 2% from January 2021, while the institutional sub-index climbed 50%.

“Economic activity in the service sector increased in January for the 20th straight month,” the Institute for Supply Management said. reported February 3. Construction is among 15 out of 18 service sectors that recorded growth in January, 18 that reported paying higher prices for materials and services, 17 that reported slower deliveries from suppliers, 11 that reported an increase in order books, with 10 reporting an increase in orders and 5 reporting an increase in employment. Items that increased in price and are significant to construction included aluminum products (2 months in a row); construction workers (6 months) and contractors (7 months); copper products (PPE, 2 months); diesel fuel (14 months); heating, ventilation and air conditioning (HVAC) equipment; lumber; personal protective equipment (2 months); polyvinyl chloride (PVC) products (5 months); and steel products (13 months). Items listed in short supply included appliances (2 months), construction contractors (5 months) and subcontractors (6 months), flexible ducts, HVAC equipment, PPE – masks and gloves, hoses and PVC fittings and steel products (5 months) .

Construction workers continue to lag behind other occupations in covid vaccination rates. Among respondents to an ongoing survey of Facebook users analyzed by Carnegie Mellon University’s Delphi Group, only 56% of respondents who identified as being in construction professions said they had been vaccinated, compared to 83 % for all other occupations during the week beginning January 23. , the construction safety and health research organization CPWR reported today. Conversely, 41% of construction respondents reported “vaccination hesitancy,” nearly triple the hesitancy rate for other occupations.

“Between April 2021 and December 2021, total state tax revenue increased by 26.3% in nominal terms compared to the same period a year earlier, Lucy Dadayan of the Urban Institute reported on Wednesday. “Growth was strong across all major sources of tax revenue: personal income tax increased 21.0%, corporate income tax increased 62.7% and sales tax increased by 23.7%. Most states anticipate continued growth in state tax revenue for the remainder of [fiscal year (FY)] 2022 as well as in fiscal year 2023.” These gains should allow states to increase funding for construction. State and local construction spending in place fell 2.8% from 2020 to 2021, Census Bureau says reported February 1.

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