Global| Jan 11 2017FIBER: Industrial Commodity Prices Remain Strong
by:Tom Moeller
|in:Economy in Brief
Summary
The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) increased 0.7% during the last four weeks and has risen 20.3% during the last twelve months. This follows strength [...]
The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) increased 0.7% during the last four weeks and has risen 20.3% during the last twelve months. This follows strength during all of last year.
In the textile group, cotton prices moved 1.5% higher during the last month and were 16.2% higher versus last year. Also showing strength were burlap prices which improved 1.9% during the last month and by 9.8% y/y. In the miscellaneous group, natural rubber prices jumped 10.1% m/m as part of a doubling in prices which took place during all of last year. Continued strength in the housing market raised framing lumber prices slightly in recent months and 12.2% y/y. Prices for structural panels similarly increased modestly in the last month and by 3.1% y/y. Crude oil & benzene costs have strengthened. WTI crude oil prices moved over $50 per barrel last month and moved up by one-half y/y. Prices for the petro-chemical benzene similarly rose by one-third y/y. Earlier strength in the metals sector cooled as prices fell last month, but they're still up by one-third y/y. Copper scrap prices declined 5.0% during the last month, but rose 20.0% y/y. Aluminum prices eased 1.0% during the month, yet increased 16.0% y/y. Continuing strong were steel scrap prices which gained 20.0% last month as part of a three-quarters price rise over the last year. Zinc prices eased 6.2% last month, but have risen by roughly one-half y/y.
The current industrial output projection from the National Association for Business Economics (NABE) calls for a 1.7% increase in production during all of 2017, following a 0.9% decline this year. During the last ten years, there has been a 52% correlation between the three-month change in prices and the change in U.S. industrial output. In addition, moderate growth in factory sector production worldwide is continuing.
Commodity price data can be found in Haver's DAILY, WEEKLY, USECON and CMDTY databases. The NABE forecast is in the SURVEYS database.
| FIBER Industrial Materials Price Index (%) | 1-Mth | 3-Mth | 6-Mth | 12-Mth | 2016 | 2015 | 2014 |
|---|---|---|---|---|---|---|---|
| All Items | 0.7 | 6.6 | 8.4 | 20.3 | 19.2 | -16.3 | -10.0 |
| Textiles | 0.4 | 2.4 | 3.7 | 3.5 | 2.8 | 2.2 | -4.2 |
| Cotton (cents per pound) | 1.5 | 6.2 | 12.2 | 16.2 | 10.2 | 2.6 | -24.2 |
| Metals | -1.6 | 9.4 | 14.3 | 34.6 | 32.9 | -27.8 | -8.7 |
| Aluminum ($ per metric ton) | -1.0 | 2.7 | 4.6 | 16.0 | 13.0 | -19.2 | 9.4 |
| Copper Scrap (cents per pound) | -5.0 | 15.8 | 16.4 | 20.0 | 17.3 | -27.0 | -12.0 |
| Steel Scrap ($ per ton) | 20.0 | 28.9 | 13.9 | 74.5 | 74.5 | -53.8 | -18.6 |
| Crude Oil & Benzene | 3.6 | 6.7 | 10.9 | 23.6 | 20.4 | -19.4 | -26.5 |
| Crude Oil (WTI, $ per Barrel) | 5.1 | 8.2 | 13.2 | 50.5 | 44.3 | -35.8 | -43.2 |
| Miscellaneous | 1.7 | 7.6 | 6.0 | 22.0 | 21.7 | -18.0 | -6.7 |
| Framing Lumber ($ per 1000 board ft.) | 1.1 | 0.8 | 3.5 | 12.2 | 12.9 | -16.4 | -1.6 |
| Natural Rubber (cents per pound) | 10.1 | 43.2 | 38.1 | 100.7 | 89.4 | -22.5 | -32.3 |
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
