If you work in the metals industry, you’ve probably noticed that prices have risen significantly. This was also not a minor increase. Steel prices have never been this high in the past 15 years that I have been in the steel fabrication industry along with other collueges that I work closely with on a daily basis who have more than 25+ years experience have voiced their concern aswell. There are a variety of reasons for this, and they aren’t all related to domestic issues. We’re dealing with a global supply issue. This post aims to shed light on some of the factors that have contributed to the current high level of steel prices. Let me begin by saying that, while most of this information can be found on the internet, I have personal experience with it.
Covid-19 transformed the world in the spring of 2020, and many companies in the industry stopped and closed down or took other precautions to keep people safe. Steel demand, of course, fell because of the worldwide mandatory shutdowns. Construction began to pick up in the fourth quarter of 2020, and other industries began to reopen across the country.
This increased demand, provided an increase of materials that were bought up quickly by contractors and manufactures which resulted in buying up more than the mills were able to produce.
Tariffs, too, must be considered. Importing has become prohibitively expensive due to the policies of our government. Prices jumped between 10% to 20% at a time, which was insane. Which is why our prices have fluccated on a daily basis and we are unable to keep the same price for more than 1-2 days based on our suppliers.
Domestically, transportation has grown significantly, and the number of cargo containers has exploded. All building materials and materials have followed suit.
From the fourth quarter of 2020 to the present November 2021, the following is an estimate of the increases:
I hope this clarifies some of the underlying factors that have pushed prices to such extremes.
High prices won’t last forever. We are hoping to see some sort of price decrease into the 2nd Quarter of 2022.
Thank you for your patience, your patronage, and your loyalty.
Nov 3, 2021 Tariff Update: Biden Rolls Back Trump’s Metal Tariffs On European Union – The New York Times (nytimes.com)