Global| Dec 18 2019FIBER: Industrial Commodity Prices Rise Slightly
by:Tom Moeller
|in:Economy in Brief
Summary
The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) increased 0.9% during the four weeks ended Friday and 0.8% over the last three months. The price index was down a [...]
The Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) increased 0.9% during the four weeks ended Friday and 0.8% over the last three months. The price index was down a lessened 2.7% y/y.
Prices in the crude oil & benzene group rose 2.6% during the last four weeks as WTI crude oil prices improved to $59.10 per barrel. They have since risen further to $60.94 per barrel as of yesterday. Prices of the petro-chemical benzene also strengthened and rose 7.0% in four weeks (19.4% y/y). Prices in the miscellaneous group improved 1.9% over four weeks as the cost natural rubber gained 6.4%. The price of framing lumber rose 5.3% but the cost of plywood slipped 0.9% (-12.2% y/y). Prices in the metals grouping eased 0.7% over the last month as lead prices declined 8.6% (-3.7% y/y). The cost of steel scrap offset this decline with an 11.2% increase in four weeks, but zinc prices also weakened 11.0% (-16.8% y/y). The cost of aluminum declined 1.7% in four weeks but copper scrap prices rose 2.7%. Prices in the textile group improved 0.3% during the last month. Burlap prices paced the increase with a 3.0% gain (-5.1% y/y), but the cost of cotton eased 0.2%.
Commodity prices could remain weak over the short term. U.S. factory output growth is projected to slow and recessions abroad are continuing. The consensus forecast from the National Association for Business Economics (NABE) calls for a modest 0.9% rise in industrial production both this year and next. During the last ten years, there has been a 71% correlation between the y/y change in industrial commodity prices and the y/y change in factory sector output.
Commodity price data can be found in Haver's DAILY, WEEKLY, USECON and CMDTY databases. The NABE forecast is in the SURVEYS database.
| FIBER Industrial Materials Price Index (%) | 1-Mth | 3-Mth | 6-Mth | 12-Mth | 2018 | 2017 | 2016 |
|---|---|---|---|---|---|---|---|
| All Items | 0.9 | 0.8 | -1.2 | -2.7 | -12.0 | 6.7 | 19.2 |
| Textiles | 0.3 | 1.6 | -1.0 | -3.8 | -2.8 | 3.0 | 2.8 |
| Cotton (cents per pound) | -0.2 | 9.6 | 0.5 | -18.6 | -9.2 | 9.8 | 10.2 |
| Metals | -0.7 | 0.8 | -4.0 | -7.3 | -12.2 | 18.6 | 32.9 |
| Aluminum ($ per metric ton) | -1.7 | -1.1 | 0.6 | -9.7 | -12.7 | 26.0 | 13.0 |
| Copper Scrap (cents per pound) | 2.7 | 4.1 | 3.4 | -2.3 | -16.1 | 29.3 | 17.3 |
| Steel Scrap ($ per ton) | 11.2 | 16.8 | -2.5 | -2.8 | 2.3 | 16.8 | 74.5 |
| Crude Oil & Benzene | 2.6 | 2.4 | 5.4 | 8.5 | -20.0 | 8.1 | 20.4 |
| Crude Oil (WTI, $ per Barrel) | 3.5 | 4.1 | 12.3 | 13.3 | -24.4 | 10.9 | 44.3 |
| Miscellaneous | 1.9 | -0.7 | -2.0 | -2.7 | -14.8 | -0.5 | 21.7 |
| Framing Lumber ($ per 1000 board ft.) | 5.3 | 10.9 | 24.1 | 16.5 | -23.1 | 20.0 | 12.9 |
| Natural Rubber (cents per pound) | 6.4 | 3.1 | -18.5 | 14.0 | -4.1 | -29.6 | 89.4 |
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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