Gypsum and cement prices soar

Although interest rates are rising and residential construction is slowing, it's full steam ahead for most manufacturers of construction and repair supplies. And strong demand is putting pressure on prices for the products that plant managers buy.

11/01/1999


Although interest rates are rising and residential construction is slowing, it's full steam ahead for most manufacturers of construction and repair supplies. And strong demand is putting pressure on prices for the products that plant managers buy.

In August, average product prices for Plant Engineering 's basket of construction materials jumped 3.9% from a year ago. Looking at prices for the entire 12-mo period ending August 1999, prices are up 2.5%. In particular, strong demand for cement, fiber glass insulation, and gypsum wallboard continues to create problems for buyers. For example, wallboard prices have increased four times in 1999, including once this past fall. By fall, wallboard was selling for about $155/1000 sq ft, compared with $119 a year ago. Average product prices in the gypsum products (SIC 3275) industry are estimated to rise 13.6% in 1999 and are forecast to rise another 0.5% in 2000. Other hot spots that plant engineers are facing include the mineral wool (SIC 3296) industry, where average prices are expected to rise 9% in 1999 and forecast to increase 1.1% in 2000. Also the softwood plywood (SIC 2436) has been causing problems with average product prices up a whopping 25% in 1999.





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