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Economy in Brief

FIBER: Industrial Commodity Price Weakness Led by Oil
by Tom Moeller  August 8, 2022

• Oil prices reach lowest level since February.

• Steel scrap & framing lumber prices remain notably weak.

Earlier weakness in the Industrial Materials Price Index from the Foundation for International Business and Economic Research (FIBER) has been sustained. The price index is down 3.4% during the last four weeks and 2.1% y/y. The weakness accompanied slight declines in factory sector output in February & March and a 3.6% y/y rise.

Prices in the Crude Oil & Benzene group fell 10.0% during the last four weeks but have risen 16.5% y/y. The cost of West Texas crude oil fell 9.9% in four weeks to $93.18 per barrel, but prices were roughly one-third higher y/y. Prices for the petro-chemical benzene declined 29.0% in four weeks but rose one-quarter y/y. The FIBER price index excluding crude oil fell 2.9% during the last four weeks and was 3.8% lower y/y.

In the Miscellaneous group, prices weakened 5.0% during the last four weeks, led by a one-quarter decline in framing lumber prices. They have fallen 12.7% during the last year. Natural rubber prices weakened 8.3% in four weeks, but were 4.4% higher y/y.

Prices in the Metals group were fairly stable during the last four weeks but down 15.1% y/y. This recent stability reflected an 8.3% rise (13.1% y/y) in zinc prices, which is used in batteries. This was offset by a 5.2% decline in steel scrap prices during the last four weeks, down roughly one-quarter y/y. Aluminum prices improved 1.2% during four weeks (-6.9% y/y). Tin prices fell 6.3% in four weeks, off one-third y/y. Lead prices rose 3.5% in four weeks (-17.1% y/y) but copper scrap prices fell 1.2% in four weeks, down 18.8% y/y.

Textile group prices slipped 0.8% in the last four weeks, but remained 3.4% higher y/y. Cotton prices were little-changed in four weeks but rose by roughly one-quarter y/y. The cost of burlap, used for sacks, bags and gardening, fell 7.0% in the last four weeks but they were up 1.6% y/y.

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.

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