First and foremost, I want to wish our customers and suppliers a Happy Thanksgiving. I hope you and yours will be able to enjoy the holiday in pre-pandemic fashion this year. We are always thankful for your business and support, but even more so as the year winds down and the holiday season ensues.
Our biggest news is on November 1, we closed on the acquisition of Increte of North Florida (IONF) in Jacksonville, Florida, resulting in our tenth branch and first branch in Florida. IONF was founded by Grant Denny, Sr. 17 years ago, and Grant is staying on with us in a sales position. Their main market is Road & Bridge contractors and they also rent concrete forms. We have already rented some of their forms to customers our ours in the Lowcountry of South Carolina. We’re going to build a rebar shop there and also start a tilt up market at this newest branch. We’re very excited to add their talented team to ours! Read the full press release from the official announcement here.
The industry continues its breakneck pace with no indication of slowing down moving into the holiday season. With both the commercial and residential space booming, elevated demand levels continue to keep pricing high and supply chains strained.
Our tilt up business is mostly booked up until June of next year. We keep landing jobs and ordering more braces, but they have been hard to get lately, too. If you have any tilt jobs coming up in 2022, please get with us ASAP and we’ll do our best to accommodate you as we have a few gaps in our schedule and we may be able to get more braces after the first of the year.
We still are trying to fill five positions. Visit https://www.newsouthsupply.com/careers/ to view open positions, and if you know of someone who can fill one (or more) of these positions, we will gladly pay a $2,000 referral fee if we hire someone you recommend to us.
See below for a closer look at pricing for the main products we sell.
Wire Mesh continues this year’s historic climb, and another price increase was pushed through on November 10th, 2021. An $80 per ton increase went into effect on all orders placed after November 10th and impacted all building mesh products. Mesh prices have more than doubled since November of 2020. With continued increasing scrap and wire rod pricing, expectations are for mesh to continue to rise well in to the first quarter of next year. Lead times on newly placed orders are still running three to four months before delivery.
Rebar also saw an increase since the last newsletter. On the evening of October 28th, one major mill announced a $40 per ton increase effective immediately on all new orders placed. By noon the next morning, two more mills in the Southeast followed and similarly announced a $40 per ton increase. The increase appears to have scared buyers into beefing up their inventories, as shortly after the price announcement November and December rebar rollings were quickly booked up. There was some initial thought that the increase would not stick, but that speculation quickly subsided, and buyers scrambled to find coverage for November and December needs.
Polyethylene sheeting remained fairly stable through November. Pricing may vary a few dollars per roll depending on the manufacturer, but most prices fell within the same variance range seen the past couple of months. There is a similar pattern on lead times. Typical size and mil needs are being fulfilled and delivered in the three-to-four-week time frame. This is much improved from this time last year, but certainly not where it was pre-pandemic.
In the past few months lumber has rapidly bottomed out, hovered at the bottom, and then had a quick but short bounce. October brought a quick bounce and prices increased almost every week during the month. Buyers remained skeptical of the market and inbound orders to the mills slacked as a result through the month. As a consequence, mills ceased the increases and flattened out the pricing. While current pricing is still more expensive than at the beginning of the month, the high-water mark has leveled and pricing has been fairly stable throughout November. With lumber demand levels flat and winter approaching, many distributors are beginning to reduce sitting inventory to reflect the usual seasonal slowdown while still closely watching the market should any large movement take place in the near future.
Contractors’ bid prices soared in October, though the y/y (year over year) increase in construction input costs exceeded the rise in bid prices, according to BLS data posted on Tuesday. The producer price index (PPI) for new nonresidential building construction—a measure of the price that contractors say they would bid to build a fixed set of buildings—jumped 7.1% from September and 12.6% y/y, while the PPI for material and service inputs to new nonresidential construction climbed 1.3% for the month and 21.1% y/y. AGC posted tables and graphs of construction PPIs.
Click here for the latest update on the construction economy from Ken Simonson, the chief economist of the AGC.