Material cost changes in Canada are starting to stir again, says Reed Construction Data chief economist Alex Carrick in his latest report.

Weak Canadian housing starts have had a significant impact on lumber prices regionally.

Softwood lumber is down 12.4% in Ontario versus six months ago and down 6.7% in B.C. versus three months ago.

Non-residential building material costs are falling because of weakness in privately-financed categories of construction, commercial and industrial.

Total ICI starts in the first half of this year in Canada were down by 50% year over year.

A similar pattern has started to emerge in the U.S.

Major material sub-components of non-residential building construction have been pulling back on the cost front, including concrete rebar (-34.6% year over year), structural steel shapes (-10.1%) and aluminum structural shapes (-6.7%).

The key question is how long this will last, Carrick says.

A resurgence in capital spending in China will impact costs everywhere in the not too distant future.

Prices of commodities such as nickel and copper are already moving up.

“For the moment, however, concrete reinforcing bar and structural steel prices are still languishing in Canada,” Carrick says.

Meanwhile, the engineering material cost index is "down dramatically when compared with last year, though it has been creeping back up over the past five month,” he adds.

As oil prices advance along with the world economic recovery, engineering construction costs will shake off their lethargy, Carrick says, exacerbated by massive government infrastructure-spending stimulus packages.