| Cement supplies remain tight in portions of 35 states, according to Ed Sullivan, chief economist of the Portland Cement Association, because of strong demand for the building material from residential construction activity and an insufficient number of ships to bring in imports. Despite the shortage conditions, Sullivan said that concrete price hikes last year averaged a “modest” 8.4% through October. He estimated that concrete costs associated with building a single-family home rose from $6,449 to $6,732, a $283 increase, during the first 10 months of 2004. With home building expected to remain robust this year as construction in the non-residential and public sectors continues to grow, Sullivan forecast that demand for cement will remain strong for the foreseeable future. To help meet the growing demand, which is driving up prices and affecting construction projects around the nation, NAHB is continuing to urge the Commerce Department to overturn punitive tariffs on Mexican cement. “It takes about 40 days to import cement from Asia and only four days from Mexico. Mexico has excess capacity that would help to satisfy U.S. demand,” said Carliner. Twenty-one percent of those surveyed reported a scarcity of oriented strand board, compared to 34% who cited a shortage in October. Only 16% of builders reported plywood shortages, the lowest reading since October of 2002 and down from 29% last October. Framing lumber shortages were cited by just 11% of respondents, compared to 24% last October. “We expect wood product prices in 2005 to remain below their peaks of last year,” said Carliner. “OSB prices are now at $11 per sheet. That's lower than last spring, but relatively high, because there is not enough capacity. Some additional capacity is scheduled to come on line this year, which will help ease price pressures.” Carliner also expressed cautious optimism regarding framing lumber, saying that Canada should win its case before a North American Free Trade Agreement panel this spring, which would eliminate duties totaling well above 20% on Canadian lumber imports. “The markets already appear to be factoring in this anticipated legal victory,” he said. “The spread between Canadian lumber sold in the U.S. and in Canada has dropped from more than $60 per 1,000 board feet to between $20 and $40 per 1,000 board feet.” Builders polled said that the scarcity of gypsum wall board fell to 17% in January from 26% in October. A similar trend was noted with rebar (steel reinforcing bars), with 14% of respondents reporting shortages, compared to 25% in October. As clean-up efforts continue from last year’s hurricane season, the shortage of roofing materials remained somewhat steady, with 19% experiencing problems vs. 22% last fall. | 
