At Yarder Manufacturing, one thing that we’re always keeping an eye on is the price of steel in our industry. After all, it’s an important part of sheet metal fabrication across the board. Not only does this help us better understand how to price certain projects, but it also allows us to paint a complete picture of what is going on for our clients as well.
For the last two years, sheet metal prices have risen and fallen at various times, creating a level of unpredictability that just wasn’t there in the past. Now, according to one recent report, steel prices have essentially stalled at the moment. This is due to a gradually decreasing demand from manufacturers, as well as because of a variety of different reasons that are certainly worth a closer look.
The Situation with Sheet Metal and Steel Prices
Several months ago, it looked as if steel prices were shooting back up again – if not to their pre-pandemic levels, as close as they had been in a while. Then, certain geopolitical situations occurred and impacted the entire market – taking demand and sheet metal and steel prices right along with them.
Part of this is because current events have significantly impacted raw material costs. This, coupled with the supply chain issues that have only been exacerbated through much of the pandemic, have created a perfect storm in the worst possible way.
All of this is actually part of a larger story – one still tied to what is happening in places like Europe. Over the last few months, activities in places like Eastern Europe have sent raw materials prices in places like the United States sky-high. Obviously, this would impact tasks like sheet metal fabrication as well. Yet at the same time, according to the report mentioned above, prices in places like Asia didn’t increase nearly as much. This is likely because, at the time, there were a number of severe COVID-19 outbreaks in places across the globe.
Naturally this created something of a ripple effect across the industry.
Lead times have also dramatically increased when it comes to obtaining these raw materials – again in large part due to conflict going on elsewhere in the world. If it’s harder to get materials from certain places like Eastern Europe, demand for said materials will naturally go down. At that point, prices will be impacted and the total volume of projects being completed will suffer as well.
While a lot of these events may seem to be negative, there are certainly a few silver linings to this particular cloud. Chief among them being that, according to the report linked above, a full 25% of steel buyers have recently reported that mills are currently willing to negotiate lower prices than normal. This is likely due to a desire to avoid having to pay to house excess stock.
Note that while 25% may not seem like a lot, it is still a significant upward trend from earlier in 2022 when that number was only at 16%. It will be interesting to see if the trend continues moving forward.
In the end, the team at Yarder Manufacturing pledges to stay up-to-date on all of the latest activities happening with this and other topics. We pride ourselves on our ability to keep our customers informed and to help them interpret what is happening in the world, all so that they can have the information they need to make the best possible choices at exactly the right time.
If you’d like to find out more information about the current state of steel prices, or if you’d just like to discuss your own needs in terms of sheet metal fabrication or laser cutting with someone in a bit more detail, please don’t hesitate to contact Yarder Manufacturing today.