The housing market is showing signs of stabilizing after being down, while commercial and public construction spending is surging. All commercial sectors are experiencing growth, with some notably so. Though there are hints of a potential cooldown, given the current high annual interest rates, a slight downside seems manageable. The infrastructure program is also ramping up, with public construction seeing a remarkable 20% increase and no signs of slowing down.
Plastic Pipe
When oil was over $100 a barrel and climbing, plastic pipe followed suit. Now that oil is at about $80, plastic pipe’s trajectory should be similar, but it’s not. Housing is soft, so it stands to reason that there should be reductions. Indeed, some sources and reporting agencies are showing a 10% reduction while some others show sizable gains. Keep a close eye on this and watch for corrections, because there still seems to be conflicting information in the marketplace.
Steel Pipe
Steel pipe continues its slowdown after three years of meteoric increases. It is down 4% for the year and seems to be slowing even further. But with the infrastructure program in full swing, steel pipe may be on the move back up.
Copper Wire
Always the target of inflation watchers, copper had not followed the increases of other construction components. The spot price for copper is $4.40, up 10% for the last 12 months − which seems to have a some bearing on wire. Copper wire is up 3% for the year. Some market watchers were predicting that the metal would increase 50% over the next 18 months, let’s see if they are right.
For more information visit the May/June issue of DCD magazine.
