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Despite Upturn in Steel, Lumber and Energy Prices,
Deflation Sweeps Cost Index Board

Publication Date: 3/24/2010
Author: Tim Grogan and Manuela Zoninsein
Format: HTML

Prices for diesel fuel, structural steel, lumber and gypsum-wallboard products started to stir during the first quarter, but most increases were coming off dismal lows in 2009 and were not strong enough to break the stranglehold the recession has on construction costs. Eleven of 15 major industry cost indexes tracked by ENR showed costs falling below a year ago. These drops included year-to-year declines of 5.8% for warehouse construction, 4.7% for office buildings and 1.7% for school construction, according to the U.S. Commerce Dept.’s January cost indexes. The agency also reported in January another 3.6% decline in homebuilding costs during the same time in 2009. This decrease marked the third consecutive year the Commerce Dept. cost index for new homebuilding has declined, following drops of 3.2% in 2009 and 2.6% in 2008.

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