Construction Material Prices Rise 0.6% in February, Steel Jumps Nearly 4%

Construction input prices increased 0.6% in February, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data.

Nonresidential construction input prices also rose 0.6% for the month.

Overall construction input prices are 0.3% higher than a year ago, while nonresidential construction input prices are down 0.1%.

Prices for iron and steel, steel mill products and softwood lumber all saw sharp increases in February.

“Nonresidential input prices increased at a rapid pace in February and have risen at a far-too-hot 9% annualized rate through the first two months of 2025,” ABC Chief Economist Anirban Basu said.

“Iron and steel prices rose at a particularly fast rate in February, a result of tariffs providing domestic producers with increased pricing power.

Despite the recent increases, nonresidential input prices remain lower than a year ago, Basu said. However, that trend may reverse as tariffs continue to push prices higher.

While ABC members remain generally optimistic about profit margins, 23% expect profitability to decline over the next six months, the highest share since October 2024, according to ABC’s Construction Confidence Index.