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Economy in Brief

FIBER: Industrial Commodity Prices Remain Weak
by Tom Moeller  June 6, 2022

• Declines were broad-based in last four weeks.

• Oil prices continue to strengthen.

The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) weakened 3.5% during the last four weeks. The decline left prices 7.4% below the peak in the second week of March.

Prices in the metals group continued to weaken, off 8.5% during the last four weeks. This decline was led by a 17.7% decline in steel scrap prices. The price of zinc, which is used in batteries, fell 4.6% during the last four weeks while aluminum prices weakened 7.0%. Copper scrap prices fell 1.9% in the same period, while tin and lead prices also fell sharply.

The miscellaneous group also weakened 5.9% during the last four weeks, led by a one-third decline in framing lumber prices. They have fallen by one half during the last year. Moving upward by 5.8% were natural rubber prices.

Textile group prices tracked 1.3% lower in the last four weeks but remained near thirty-year highs. Cotton prices weakened 8.0% but rose by roughly two thirds y/y. The cost of burlap, used for sacks, bags and gardening, rose 0.2% in the last four weeks and were near the record high.

Offsetting these declines was an 8.2% increase in prices in the crude oil & benzene group, which have risen by one-third during the last year. Crude oil costs alone also rose 8.2% during the last four weeks and were up 68.2% y/y. The per barrel price of crude oil of $114.87 compared to $75.80 at the end of 2021. The price of the petro-chemical benzene rose 28.7% in four weeks and was 56.3% higher y/y. Excluding crude oil, industrial commodity prices weakened 4.1% in the latest four weeks but have risen 1.3% y/y.

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.

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