Storage Talk with CEO Tom Rogers: An update on the relentless increase in steel prices, and a call for immediate action
May 18, 2021 3:53 pm
As promised, this is our follow-up to our February alert on the global uptick in steel prices.
Our hope was that we would find some relief from the extraordinary rise of costs in steel by the second half of 2021, but this, unfortunately, is not the case. In fact, global commodity prices are at an unprecedented high – with materials such as drywall, lumber, aluminum, and steel projected to continue their price incline, with an anticipated 10-20% hike in steel costs in the upcoming months, as reported by the New York Times.
As Fitch Ratings states, “The rally is the result of a combination of factors, including a strong demand from the construction industry as well as electronic vehicle production, the implementation of production restriction policies, and higher iron ore prices.”’
With global lags in supply from pandemic-related bottlenecks, commodities such as iron, which account for half of the steel prices, cannot keep up with the skyrocketing global demand.
And with the U.S.’s sharp increase in import tariffs in recent years, inventory shortages have been further exacerbated, creating an unparalleled rise in steel prices – to a recent record high of $US193.85 a tonne.
This means that the time is now, not later, to invest in the project sitting on the back of your desk. Waiting for the price of steel to decline is no longer viable. The truth is, commodities not only are going to get more expensive over the next year, but they are going to become scarcer.
As your business partner, we want to provide the most transparent advice possible, so we can together make expedient decisions and get through this trying time. We work to keep our prices fair, and customers informed. Please be on the lookout for future updates.
Thank you for your patience. Please reach out to us with any questions.
Your Regional Sales Manager
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