Recent Updates

  • UK: Gilt Issuance (Sep)
  • Belgium: Business Surveys (Oct), Capacity Utilization (Q4)
  • Flash PMIs: Australia, Japan, France, Euro Area, Germany, UK, US (Oct)
  • Lebanon: Trade in Goods (Aug)
  • more updates...

Economy in Brief

FIBER: Industrial Commodity Price Declines Stabilize
by Tom Moeller  May 11, 2020

The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) fell 0.8% during the four weeks ended Friday. The price index has moved irregularly sideways for the last six weeks but remained 17.7% lower than twelve months earlier.

Prices in the metals group improved 1.0% during the  last four weeks as the cost of copper scrap rose 3.7% and zinc prices increased 2.1% (-31.5% y/y). Steel scrap prices edged 0.9% higher and aluminum prices gained 0.4%. To the downside, lead prices fell 4.1% (-14.0% y/y) in the last four weeks. Also improving by 0.7% were prices in the textile group. Cotton prices surged 4.5% but the cost of burlap held steady (1.7% y/y).

Continuing to work lower were prices in the crude oil & benzene group which fell 5.6% in the last four weeks as WTI crude oil prices weakened to $22.74 per barrel, down from a high of $61.92 in the first week of January. Prices remained near the lowest level since early-2002. Prices of the petro-chemical benzene fell 5.4% in the last four weeks (-56.5% y/y). Excluding crude oil, industrial commodity prices eased 0.1% during the last four weeks and were off 13.6% over the last year. Prices in the miscellaneous group declined 1.3% as hide prices fell by one-third (-43.9% y/y). Plywood prices continued to hold steady but were down 7.9% y/y. Framing lumber prices rose 14.4% in the last four weeks and the price of natural rubber improved 1.9%.

A struggling U.S. factory sector holds little promise for improvement in industrial materials prices. Industrial output plummeted 6.3% in March (-6.6% y/y) as the effects of the coronavirus started to be felt. During the last ten years, there has been a 57% correlation between the y/y change in industrial commodity prices and the y/y change in factory sector production.

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

FIBER Industrial Materials Price Index (%) 1-Mth 3-Mth 6-Mth 12-Mth 2019 2018 2017
All Items -0.8 -14.3 -14.6 -17.7 1.1 -12.0 6.7
  Excluding Crude Oil -0.1 -10.8 -10.6 -13.6 -0.6 -11.1 4.9
 Textiles 0.7 -3.2 -1.8 -4.5 -1.6 -2.8 3.0
  Cotton (cents per pound) 4.5 -20.6 -18.1 -26.0 -6.6 -9.2 9.8
 Metals 1.0 -10.7 -16.6 -19.8 -4.3 -12.2 18.6
  Aluminum ($ per metric ton) 0.4 -14.9 -19.9 -18.6 -6.5 -12.7 26.0
  Copper Scrap (cents per pound) 3.7 -9.2 -12.6 -16.5 3.5 -16.1 29.3
  Steel Scrap ($ per ton) 0.9 -7.3 -7.9 -17.8 -0.8 2.3 16.8
 Crude Oil & Benzene -5.6 -39.2 -39.9 -41.6 20.2 -20.0 8.1
  Crude Oil (WTI, $ per Barrel) -11.7 -55.6 -59.8 -63.3 35.5 -24.4 10.9
 Miscellaneous -1.3 -11.6 -8.1 -12.1 -0.0 -14.8 -0.5
  Framing Lumber ($ per 1000 board ft.) 14.4 -22.4 -17.0 -7.6 22.6 -23.1 20.0
  Natural Rubber (cents per pound) 1.9 -3.9 -1.7 -15.2 10.7 -4.1 -29.6
close
large image