Global| Apr 13 2015FIBER: Industrial Commodity Prices Improve
by:Tom Moeller
|in:Economy in Brief
Summary
The industrial commodity price index from the Foundation for International Business and Economic Research (FIBER) improved roughly 2.0% during the last eight weeks reflecting broad-based improvement amongst several industrial sectors. [...]
The industrial commodity price index from the Foundation for International Business and Economic Research (FIBER) improved roughly 2.0% during the last eight weeks reflecting broad-based improvement amongst several industrial sectors.
Prices in the crude oil & benzene grouping posted a 4.4% rise, but were still down by one-third y/y. The price for a barrel of WTI crude oil rallied to $50.81 as of Friday from the January low of $44.43, but was still off 50.7% y/y. The petro-chemical benzene also improved sharply versus February lows but remained down by nearly half y/y. Prices in the textile sector also showed improvement with a 1.5% rise since the middle of March. Cotton prices led the gain with an 8.1% rise but they're still down 23.1% y/y. In the metals sector, the earlier decline in prices stabilized, though the index remained near its lowest point since mid-2010. Copper scrap prices led the rebound with a 12.0% rise since the end of January (-8.9% y/y). They remain down, however, by roughly 40% from the yearly-2011 high. Zinc prices (+6.0% y/y) similarly firmed. Aluminum prices have not joined the improvement, remaining off 4.3% y/y and down by one-third since mid-2011. Steel scrap prices also remain weak, falling to the lowest level since the end of 2009 (-37.4% y/y). Prices in the miscellaneous materials grouping also remain depressed, off 10% y/y. Natural rubber prices have improved slightly this year but remain down by roughly one quarter y/y, off two-thirds since early 2011. Framing lumber prices were off 8.9% y/y but structural panel prices rose 4.5% y/y; still they remain one-quarter below the 2013 high.
Future support for commodity prices may be on the way. The current industrial output projection from the National Association for Business Economics calls for 3.7% growth in production in 2015 followed by a 3.2% rise next year. During the last ten years, there has been a 52% correlation between the three-month change in prices and the change in industrial output.
Commodity price data can be found in Haver's DAILY, WEEKLY, USECON and CMDTY databases.
| FIBER Industrial Materials Price Index (1990=100) | 4/10/15 | Y/Y % | 2014 | 2013 | 2012 |
|---|---|---|---|---|---|
| All Items | 143.92 | -13.4 | 163.5 | 169.0 | 166.3 |
| Textiles | 75.73 | -3.6 | 76.8 | 78.2 | 77.8 |
| Cotton (cents per pound) | 64.16 | -23.1 | 73.6 | 79.6 | 74.4 |
| Metals | 202.50 | -14.3 | 237.8 | 236.2 | 242.7 |
| Aluminum ($ per metric ton) | 1,773.00 | -4.3 | 1,864.9 | 1,846.7 | 2,016.6 |
| Copper Scrap (cents per pound) | 274.35 | -8.9 | 311.7 | 332.3 | 360.3 |
| Steel Scrap ($ per ton) | 226.67 | -37.4 | 358.3 | 345.8 | 366.5 |
| Crude Oil & Benzene | 146.91 | -32.0 | 205.2 | 207.7 | 204.0 |
| Crude Oil (WTI, $ per Barrel) | 50.81 | -50.7 | 93.5 | 97.9 | 94.2 |
| Miscellaneous | 181.60 | -10.1 | 199.6 | 218.3 | 205.2 |
| Framing Lumber ($ per 1000 board ft.) | 337 | -8.9 | 383 | 383 | 321 |
| Natural Rubber (cents per pound) | 121.94 | -23.5 | 140.2 | 190.0 | 211.8 |
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.
More Economy in Brief
