Economy
May 14, 2018
June PPI Shows Aluminum Prices Rising Even Faster Than Steel
Written by Peter Wright
Carbon steel prices have escalated at a lower rate than aluminum, but higher than plastic and wood. Truck transportation prices are rising faster than rail, according to the latest data from the Bureau of Labor Statistics. Last week, the BLS released its series of producer price indexes (PPIs) for more than 10,000 goods and materials through June. Using this information, Steel Market Update provides subscribers with a view of the competitive position of sheet steel, aluminum and plastic, as well as downstream products including beverage cans, metal buildings and pipe, along with a comparison of truck and rail transportation.
The PPIs are helpful in monitoring price direction and based on known transaction prices are a reasonable representation of the real world, though there may be a lag between the BLS reports and spot prices for steel products. We have also concluded that the actual index values of the PPIs of different products cannot be compared with one another because they are developed by different committees within the BLS. We believe this data is useful in comparing the direction of prices in the short and medium term, but not the absolute value.
