Global| Jan 13 2020FIBER: Industrial Commodity Prices Continue to Strengthen
by:Tom Moeller
|in:Economy in Brief
Summary
The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) increased 1.7% during the four weeks ended Friday and 3.9% over the last three months. The price index increased 0.8% [...]
The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) increased 1.7% during the four weeks ended Friday and 3.9% over the last three months. The price index increased 0.8% y/y.
Prices in the crude oil & benzene group rose 2.7% during the last four weeks as WTI crude oil prices strengthened to $61.86 per barrel on Friday. Prices of the petro-chemical benzene also rose 4.8% in the last four weeks (44.2% y/y). Metals prices increased 1.8% over four weeks as the cost of steel scrap improved 2.8% and the price of copper scrap also rose 1.8%. Zinc prices rose 5.7% over four weeks (-6.3% y/y) and lead prices improved 0.4% m/m (-2.0% y/y). Aluminum prices moved 1.3% higher in the last four weeks. Prices in the miscellaneous group improved 1.4% over four weeks as the cost of natural rubber gained 1.5%. The price of framing lumber eased 0.3% but plywood costs held steady over four weeks (-11.0% y/y). Prices in the textile group increased 1.3% during the last month. Cotton prices rose 6.7% and burlap prices improved 2.7% (-4.1% y/y).
The recent improvement in industrial commodity prices followed a 1.1% rise (-0.9% y/y) in U.S. factory output during November, which had declined in three of the prior four months. The consensus forecast from the National Association for Business Economics (NABE) calls for a modest 0.9% rise in factory sector output this year. During the last ten years, there has been a 71% correlation between the y/y change in industrial commodity prices and the y/y change in factory sector output.
Commodity price data can be found in Haver's DAILY, WEEKLY, USECON and CMDTY databases. The NABE forecast is in the SURVEYS database.
| FIBER Industrial Materials Price Index (%) | 1-Mth | 3-Mth | 6-Mth | 12-Mth | 2019 | 2018 | 2017 |
|---|---|---|---|---|---|---|---|
| All Items | 1.7 | 3.9 | 0.0 | 0.8 | 1.1 | -12.0 | 6.7 |
| Textiles | 1.3 | 2.5 | 1.5 | -1.1 | -1.6 | -2.8 | 3.0 |
| Cotton (cents per pound) | 6.7 | 11.3 | 12.0 | -3.9 | -6.6 | -9.2 | 9.8 |
| Metals | 1.8 | 4.4 | -0.6 | -2.5 | -4.3 | -12.2 | 18.6 |
| Aluminum ($ per metric ton) | 1.3 | 3.2 | -0.9 | -4.0 | -6.5 | -12.7 | 26.0 |
| Copper Scrap (cents per pound) | 1.8 | 8.4 | 4.3 | 3.8 | 3.5 | -16.1 | 29.3 |
| Steel Scrap ($ per ton) | 2.8 | 25.9 | 0.3 | 6.5 | -0.8 | 2.3 | 16.8 |
| Crude Oil & Benzene | 2.7 | 7.1 | 1.8 | 16.1 | 20.2 | -20.0 | 8.1 |
| Crude Oil (WTI, $ per Barrel) | 4.7 | 16.9 | 4.9 | 23.2 | 35.5 | -24.4 | 10.9 |
| Miscellaneous | 1.4 | 2.9 | -1.5 | -1.2 | -0.0 | -14.8 | -0.5 |
| Framing Lumber ($ per 1000 board ft.) | -0.3 | 18.2 | 10.0 | 20.1 | 22.6 | -23.1 | 20.0 |
| Natural Rubber (cents per pound) | 1.5 | 14.3 | -9.5 | 5.8 | 10.7 | -4.1 | -29.6 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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