HVAC Industry Numbers Send Mixed Messages
Beyond the unitary reports, sheet steel prices and construction numbers are rising. Sheet steel prices have moved upward from $508 per ton in February and are expected to close at $600 per ton in June. Short supply, rising global prices, and a slowdown in imports are some of the factors that have contributed to the increase.
“In March, single-family homebuilding finally held steady and nonresidential construction boomed again,” said Ken Simonson, chief economist for the Associated General Contractors of America (AGC). Simonson was commenting on the April 30 construction spending report from the Census Bureau.
“Total construction spending rose 0.2 percent in March, seasonally adjusted, while the gain for February was revised from 0.3 percent to a huge 1.5 percent,” Simonson remarked. “New, private single-family construction edged up 0.1 percent for the month, though it was down 27 percent from a year ago.”
According to the AGC, private nonresidential surged 2.4 percent for the month and 17 percent year-over-year. Public construction was up 0.4 percent from February and 9 percent from March 2006. “For 2007 as a whole, I expect the biggest private gainers to be power- and energy-related projects, some of which the Census includes in manufacturing, lodging, and hospitals,” Simonson said. “The office market, along with some retail construction, will be dragged down by a continuing steep decline in new single-family construction. Public construction should remain modestly positive but will be pressured by rising costs for construction materials and components.”
Publication date: 05/21/2007