The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) was fairly steady during the last four weeks, rising 0.3% as activity in the industrial sector improved. The price index declined, however, by 4.1% during the last three months and 12.0% y/y. Price movement amongst product categories continued to vary.

Showing strength were prices in the crude oil & benzene category which rose 1.8% during the last four weeks. Crude oil prices rose to $57.75 per barrel. They remained below the $65.28 high in late-April and the $75.05 early-October peak. Prices for the petro-chemical benzene fell 4.1% during the last month, and fell 5.5% y/y. Prices in the miscellaneous group rose 1.1% during the last four weeks as prices for structural panels improved 3.5%, but remained down by one-third y/y. Natural rubber also declined 13.9% over the last four weeks. Offsetting these declines was a 10.7% one-month rise in the cost of framing lumber. Metals prices edged 0.5% higher over the last month reflecting a 4.1% increase in aluminum prices. Steel scrap prices improved 2.2% and prices for copper scrap rose 1.7% during the last month. Lead prices also increased 5.0% (-2.4% y/y) but zinc prices fell 4.7% (-4.1% y/y). Moving 1.5% lower were prices in the textile group during the last four weeks as cotton prices fell 7.3%. Burlap prices also declined 2.8% (-3.5% y/y).

Improvement in industrial commodity prices may be forthcoming. The consensus forecast from the National Association for Business Economics (NABE) calls for a 2.4% rise in industrial output during all of 2019 and a 1.8% gain next year. During the last ten years, there has been a 52% correlation between the y/y change in industrial commodity prices and the y/y change in factory sector output.

Commodity price data can be found in Haver's DAILY, WEEKLY, USECON and CMDTY databases. The NABE forecast is in the SURVEYS database.