Why Future Steel Prices Are Inconsistent
Commodity markets are among the most volatile in the world, and steel is often right in the middle of that volatility. Steel prices can change quickly, and those changes can have a huge effect on the costs of steel products, especially steel buildings. That can be confusing for consumers who are accustomed to purchasing products at a set price. When it comes to steel buildings, unreliable future steel prices can change the price of a building within days – surprising prospective buyers unaware of the factors at play. If you’re wondering how all of this works and ways to manage this risk, we’ll take a closer look here.
Uncertainty of Future Steel Building Prices
The steel industry is in a constant state of flux, but especially so in 2018 with the market being the focal point of an escalating trade war. With the March announcement of 25-percent tariffs on all imported steel, economists are still unsure of the short- and long-term effects of the significant policy change, creating a sense of uncertainty surrounding an already volatile industry.
Building Prices 2020
30x50
$20,000-$25,000
50x100
$45,000-$55,000
100x100
$95,000-$120,000
Building Prices 2021
30x50
$40,000-$45,000
50x100
$90,000-$100,000
100x100
$200,000-$225,000
Opposing Opinions on Future Prices
On one hand, the price of steel has increased nearly 40 percent since March. On the other hand, some experts are projecting a price drop as early as the end of this year. All in all, this most recent episode is just the latest example of the instability of the commodities market and how it can affect the final cost of metal buildings.
Top 3 Pricing Questions
If your steel is American, why are your prices increasing?
The price of steel is determined on a global scale. If there is a construction boom in South America or Europe, it will draw down the American steel supply as well as the global supply. More demand and less supply results in higher prices.
How does General Steel combat the increases?
We are constantly working with the plants to get the best prices for our customers. We also allow you to lock your price for a negotiated amount of time, sort of like locking an interest rate on your mortgage.
What are the pitfalls to watch out for?
Some companies will quote you a price far below the current price of the building. They do this knowing they can simply change order you later once you’ve signed their contract.
Navigating the Buying Process
We don’t want you to be surprised when you receive an estimate for your steel building. That’s why our project consultants discuss the current price of steel as well as any market conditions that could cause a sudden fluctuation in price. As you move through the buying process, we’re here to help you navigate any potential pitfalls to ensure you get the building you need at the price you expect.