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Economy in Brief

FIBER: Industrial Commodity Prices Continue to Strengthen
by Tom Moeller  October 22, 2021

• Price increases remain broad-based.

• Metals & crude oil prices surge.

• Rubber prices rebound.

The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) rose 6.4% during the four weeks ended October 22. The increase occurred despite the easing in factory sector production during the most recent two months.

Prices in the metals group rose 11.8% in the last four weeks reflecting a 21.7% surge (48.3% y/y) in zinc prices. Copper scrap prices strengthened 12.4% over the last four weeks while the cost of steel scrap improved 8.5% over four weeks. Aluminum prices rose 7.9% during the last four weeks.

Crude oil & benzene prices strengthened 6.8% during the last four weeks. The cost of crude oil rose 15.3% over four weeks to $82.72 per barrel, the highest level since October 2014. Prices for the petro-chemical benzene increased 6.6% over four weeks and rose 106.1% y/y. Excluding crude oil, industrial commodity prices rose 5.9% in the last four weeks.

Miscellaneous group prices rose 4.2% during the last four weeks as framing lumber prices jumped 16.1% to the highest level since the second week of July. Plywood prices continued to hold steady. Natural rubber prices improved 10.1% in the last four weeks, after sharp declines earlier this year.

Prices in the textile group rose 3.1% in the last four weeks. Cotton prices jumped 19.3%. The cost of burlap, used for sacks, bags and gardening improved 2.3% in the last four weeks (29.4% y/y).

Industrial commodity prices are likely to remain firm. The industrial production forecast from the National Association for Business Economics calls for a 5.7% rise in industrial output this year, followed by a 4.2% gain in 2022.

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 2020 2019 2018k
All Items 6.4 7.1 6.1 31.1 13.5 1.1 -12.0
  Excluding Crude Oil 5.9 6.4 4.6 27.6 16.0 -0.6 -11.1
 Textiles 3.1 3.6 5.2 10.7 3.9 -1.6 -2.8
  Cotton (cents per pound) 19.3 22.9 29.3 59.2 11.6 -6.6 -9.2
 Metals 11.8 12.2 22.5 60.3 20.4 -4.3 -12.2
  Aluminum ($ per metric ton) 7.9 27.6 33.5 69.3 13.1 -6.5 -12.7
  Copper Scrap (cents per pound) 12.4 11.6 10.4 52.1 26.9 3.5 -16.1
  Steel Scrap ($ per ton) 8.5 -2.3 11.7 65.5 43.6 -0.8 2.3
 Crude Oil & Benzene 6.8 5.3 2.6 50.2 -9.7 20.2 -20.0
  Crude Oil (WTI, $ per Barrel) 15.3 19.0 32.6 103.8 -21.4 35.5 -24.4
 Miscellaneous 4.2 6.4 -4.5 18.1 29.1 -0.0 -14.8
  Framing Lumber ($ per 1000 board ft.) 16.1 24.8 -45.4 25.7 113.5 22.6 -23.1
  Natural Rubber (cents per pound) 10.1 6.1 -11.8 -11.7 48.6 10.7 -4.1
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