Debate among economists has shifted from when a recovery will begin to how strong it will be, but buyers in manufacturing remain cautious. Surveys continue to reflect neither dramatic expansion in short-term purchasing plans nor price increases for several groups of commodities.

PURCHASING's weighted price indexes declined in March for pulp, paper, energy, chemicals and plastic resins. PURCHASING's aggregate Industrial Supplies Price Index (ISPI) slipped to 102.2 in March from a revised 103.2 the month before. In fact, the latest index is perilously close to the cyclical low of 101.8 recorded in December 2001. Prices are rising, however, for wood and steel products.

Lumber prices fell late last year as inventories were depleted. Now, the construction industry is replenishing stocks while imports from Canada are being reduced.

PURCHASING's Metals Price Index rose slightly in March. Nonferrous metals prices continue to fall due to weak demand and excess supply, but steel prices have begun to rise because of new tariffs that are making foreign-made mill products scarcer and more costly.