The mechanism
A concrete or cement escalation clause ties the cement-related part of a contract price to a published index instead of fixing it at signing. For cement itself, the BLS producer price index is Cement, Hydraulic, series WPU1322. For delivered ready-mix, the industry series is PCU327320327320, Ready-Mix Concrete Manufacturing. It prices the batched output (cement, aggregate, water, admixtures and delivery together), not cement alone. The live data on this page uses the cement series.
Cement is a large cost inside ready-mix. Ready-mix supply contracts often run long enough that a fixed bid price becomes hard to hold if that input moves.
The calculation, step by step
- Base index value. The index value at the base period, usually the month of contract signing or bid submission.
- Current index value. The index value at the adjustment date, usually the month of delivery or invoicing.
- Ratio. Current value divided by base value.
- Adjustment. The ratio applied to the concrete- and cement-affected portion of the contract price, not necessarily the whole contract.
Take a contract signed in September 2025 with $400,000 of hydraulic cement scope, invoiced in September 2026.
| Base index, Sep 2025 | 360.462 |
| Current index, Sep 2026 (revisable) | 356.209 |
| Ratio, 356.209 ÷ 360.462 | 0.9882 |
| Amount at signing | $400,000 |
| Adjustment taken off that amount | −$4,719 |
Live figures from the stored series, updated when the provider publishes. Sep 2026 can still be revised, so a clause should say whether the invoice uses the first published value or is trued up later.
Where clauses go wrong
- No series code. "The cement index" is not a series. BLS publishes distinct series for hydraulic cement (WPU1322), concrete block and brick (WPU1331), ready-mix concrete (PCU327320327320) and the wider cement and concrete products group. They price different things. Name the exact code so there is nothing to argue about later.
Over the 12 months to Sep 2026, these series moved differently. On the same $400,000, the gap between the highest and lowest is $21,045.
| Series | What it covers | 12 months | On $400,000 |
|---|---|---|---|
WPU1322 | Cement, Hydraulic | −1.2% | −$4,719 |
PCU3273--3273-- | Cement and Concrete Product Manufacturing | +4.1% | +$16,325 |
WPU1331 | Concrete Block and Brick | +3.6% | +$14,259 |
- No averaging window. A single month's index value is more volatile than a 3-month rolling average. Clauses should state which is used.
- Double-counting energy. Cement making uses a lot of energy. A clause that indexes both a cement series and a separate energy series can price the same cost twice unless the two cover different parts of the contract. In the BLS data since 2016 the cement series has not followed the Henry Hub gas price, so a separate gas adjustment adds a different risk, not a repeat of the same one.
- No cap or floor. Without a cap, an index spike passes through in full, which can make the clause commercially unworkable in a large swing.
Related
- Free escalation clause analyzer: paste a clause and see the formula, undefined terms, and risk score.
- Live WPU1322 index page: the full history, a chart, and the values to copy.