Dodge Momentum Index Sees First Decline This Year

“Uncertain demand for some building types (such as retail and hotels), higher material prices, and continued labor shortages are weighing down new project planning,” the group said in a statement.

Case in point when it comes to higher costs: SMU’s benchmark hot-rolled coil price is at $1,770 per ton ($88.50 per cwt), an all-time high by a wide margin. That figure is up 80% from $985 per ton at the beginning of 2021 and more than triple $475 per ton in July of 2020, according to SMU’s interactive steel pricing tool.

“June’s retreat in planning activity is another sign that the recovery from the pandemic-led recession will be nonlinear,” Dodge said.

Despite the June dip, the Momentum Index remains near a 13-year high. It is up 41% versus June 2020 with planning for commercial construction up 39% year-over-year and that for institutional construction up 46%.

“The current level of the Momentum Index and its underlying components … continue to signal that a more broad-based recovery in nonresidential construction starts will occur in 2022,” Dodge said.

Thirteen new projects valued at $100 million or more entered planning in June, the group said.

The Dodge Momentum Index is a key advance indicator of nonresidential construction demand. The group says its planning data lead construction spending by as much as a year.

An interactive history of the ­­­­­­­­­­­­­­Dodge Momentum Index is available here on our website. If you need assistance logging into or navigating the website, please contact us at info@SteelMarketUpdate.com.