The combined Cost-Variance Index of electrical supplies rose 0.64% during the second quarter of 1999. This quarter's growth seems to reflect the influence of a strong U.S. economy, consumer confidence and a June rebound in the copper market. On the heels of the combined Cost-Variance Index's first-quarter decline, a stronger than usual second quarter moved the combined index to a mid-year point down just 0.10% from its January 1 position. According to figures, statistics and reports from the U.S. Department of Commerce, U.S. Census Bureau, Consumer Research Center, and Federal Reserve Board, consumer demand and confidence are high, measurements on building remain on a growth trend, and manufacturing is running below its average capacity. Additionally, according to a late June report from The Conference Board the composite indexes of the leading, coincident and lagging indicators taken together show a healthy economy. All together, these forces should continue to drive the cost of electrical building supplies moderately higher as we finish out 1999.

BY THE NUMBERS The combined Cost-Variance Index (1982=100) began 1999 at 191.22, dropping to 189.83 on March 31, and rebounding to 191.04 by June 30. Price change activity was slightly stronger than is typical for the second quarter. Of the 18 commodity categories, ten commodity groups recorded increases in value while the remaining eight came in virtually unchanged, reporting little (+/- 0.03%) or no change in April, May and June. The second-quarter commodity group leaders were the Conduit & Raceway category (weighted at 8.98%) jumping 3.46%; Tools (weighted at 6.01%) climbing 2.35%; Conduit Fittings and Boxes (weighted at 14.00%) moving up 0.70%; and Residential Lighting (weighted at 2.31%) rising 1.13%. The table below illustrates second-quarter variances for each of the 18 commodity categories, their weighted percentage of the index, and the Year-to-Date (YTD) variance.

THIRD-QUARTER CHANGES Although third-quarter activity is traditionally the slowest of the year, a higher than usual number of manufacturers have indicated price changes are coming. Specific changes have been announced affecting these commodity categories: Builders Products; Connectors, Lugs, Etc.; and Industrial and Commercial Lighting. Continued upward movement is also expected within the Wire, Cord and Cable category.

Want to use this article? Click here for options!
© 2007 Penton Media, Inc.