Steel Prices Expected to Rise! Take Advantage of Low Material Cost Now!
There are many complex factors that go into the price of steel. In our global economy, distant and seemingly obscure things can factor into the production of steel, affecting the price. Suddenly, events in a country on the other side of the world can have an affect on how much steel costs for a car manufacturer or construction company in the United States. A natural disaster in India or a labor dispute in Russia can dramatically impact the price of steel.
Steel is a commodity and as such, is ruled by the law of supply and demand. While that may be over simplifying all the complex factors that play into steel prices, it eventually boils down to supply and demand; the amount of a commodity, product of service and the desire of buyers for it, considered as factors regulating its price. Experts are expecting steel prices to increase as soon as the first quarter in 2017. This predicted rise is due to 2 specific factors:
1) Increased Nonresidential Construction - The American Institute of Architects is predicting an increase of nonresidential construction of 5.6% in the United States for 2017. To many experts, that prediction indicates increased demand for steel in the U.S. in 2017. Those predictions are in spite of the fact that steel prices hit an all time low in March of this year. Prices increased over the summer and then stabilized around the fall season. Experts don't expect prices to fall again during the spring in 2017.
2) Reduced Production in China - Another factor in rising steel prices, is Chinese officials pledging to decrease steel production significantly by 2020. China is the largest producer of steel globally, producing nearly 50% of the world’s steel. A cut in their production will dramatically change the supply of steel in the market and absolutely affect prices in the United States.
These factors mean higher demand and lower supply, raising the price of steel. For people planning on building a post frame building, this means getting a price on your building and locking it in as soon as possilbe is vital to avoid uneccessarily paying more money on your building project. Since the steel siding & roofing covers nearly all of the exterior (and potentially the interior) of your building, it can be one of the highest material costs for your post frame project. Material costs will increase even more for a steel frame building, making post frame a more economic option in addition to being more energy efficient. Rising steel prices will translate into a higher price for you. Taking advantage of the low steel price now is critical to ensuring you pay the lowest price without sacrificing the quality you need.