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Economy in Brief

FIBER: Industrial Commodity Prices Weaken
by Tom Moeller  April 11, 2022

• Recent price declines are broad-based.

• The cost of crude oil falls sharply.

• Lumber prices collapse.

The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) fell 2.2% during the four weeks ended April 8 but remained 17.2% higher over the last year.

Crude oil & benzene prices fell 6.7% in the last four weeks but remained up by roughly one-quarter y/y. Crude oil costs alone fell 13.6% in four weeks yet were up by two-thirds y/y. The cost of crude weakened to $99.92 per barrel. The price of the petro-chemical benzene fell 7.7% during the last four weeks but was 12.8% higher y/y. Excluding crude oil, industrial commodity prices declined 1.5% yet gained 14.7% in the last year.

Prices in the metals group fell 1.8% in the last four weeks, up 38.5% during the last year. Aluminum prices led the decline and were off 6.9% in four weeks. They, nevertheless, have risen by roughly one half y/y. Steel scrap prices fell 5.0% (+39.0% y/y) but zinc prices improved 6.9% in the last four weeks, up 55.0% y/y. Copper scrap prices edged 0.1% higher in the last four weeks and by 16.0% y/y.

In the miscellaneous group, prices declined by 4.1% during the last four weeks (+2.2% y/y). Framing lumber prices weakened by one-quarter in four weeks and by 17.1% y/y. Prices stood at the lowest level since early-December. This decline was countered by a 6.9% increase (11.6% y/y) in natural rubber prices.

Prices in the textile group also moved 2.4% higher (11.6% y/y) during the last four weeks, led by cotton prices which increased 15.4%, up roughly three-quarters y/y. The cost of burlap, used for sacks, bags and gardening, improved 0.9% in the last four weeks and rose by 18.8% y/y.

Industrial commodity prices should remain firm. The National Association for Business Economics expects a 4.1% rise in industrial output in 2022 and a 2.6% increase in 2023.

The Foundation for International Business and Economic Research (FIBER) develops economic measurement techniques as applied to business cycles and inflation in the U.S. and other market economies. The commodity price data can be found in Haver's DAILY, WEEKLY, USECON and CMDTY databases.

FIBER Industrial Materials Price Index (%) 4-Week 3-Month 6-Month 12-Month 2021 2020 2019
All Items -2.2 6.8 12.7 17.2 18.3 13.5 1.1
  Excluding Crude Oil -1.5 5.5 11.8 14.7 16.3 16.0 -0.6
 Textiles 2.4 3.4 4.7 11.6 9.5 3.9 -1.6
  Cotton (cents per pound) 15.4 19.2 26.4 77.8 49.9 11.6 -6.6
 Metals -1.8 16.0 23.5 38.5 31.8 20.4 -4.3
  Aluminum ($ per metric ton) -6.9 20.6 18.6 53.2 41.3 13.1 -6.5
  Copper Scrap (cents per pound) 0.1 6.7 13.1 16.0 23.2 26.9 3.5
  Steel Scrap ($ per ton) -5.0 37.7 38.8 39.0 10.3 43.6 -0.8
 Crude Oil & Benzene -6.7 12 4 15.4 24.1 28.7 -9.7 20.2
  Crude Oil (WTI, $ per Barrel) -13.6 29.5 28.6 67.0 57.5 -21.4 35.5
 Miscellaneous -4.1 -0.6 9.1 2.2 9.8 29.1 -0.0
  Framing Lumber ($ per 1000 board ft.) -25.9 -19.9 44.7 -17.1 27.4 113.5 22.6
  Natural Rubber (cents per pound) 6.9 27.0 40.2 11.6 -11.7 48.6 10.7
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