What Influences the Price of Steel?
Steel is a global commodity, and its price varies daily based on a variety of factors. From supply and demand to the strength of the American dollar, seasonality to global pandemics, these factors and more combine to determine the price of steel for manufacturers, buyers, and consumers.
- The strength of the United States dollar
- Demand for steel used in any product
- Trade tariffs
- General condition of the world economy
- Natural disasters
- Wars and other political events
The Pricing Factors You Control vs External Influencers
The price of your steel building, in part, is determined by its size and customization options. Those are internal factors that you can control. But the price of steel, an external factor, also significantly affects the final cost of your steel building. That’s why we examine the most authoritative sources in the industry to produce our annual forecast. When you’re equipped with the most accurate information on steel pricing, you can determine the best time to lock in your steel building price
Steel Prices in Hindsight
2019 Steel Price History and Events
Learn how political turmoil and stronger than expected demand in 2019 lead to the second straight year of higher than predicted steel prices.
2020 Steel Price History and Events
Discover why a drop in steel prices was temporary and the pandemic changed the landscape for this commodity overnight.
Todays Current Steel Price
According to tradingeconomics.com steel prices bottomed out in April 2020 before recovering in November and December 2020. Prices are expected to continue to increase due to a lack of supply and increasing demand as the United States and China’s economies rebound from the pandemic.
Why Steel Prices Are Measured in Yuan
Trading Economics presents the price of steel according to the Chinese currency called Yuan. This is primarily due to the fact that China is the world’s largest producer and typically the biggest consumer of steel. To convert the steel price from the graph, simply use this currency converter to see the exchange rate between Chinese Yuan and American Dollar.
Supply Continues to Lag Behind Demand
These forecasts are balanced with less optimistic outlooks, including Worldsteel’s projection:
“In 2021 steel demand is expected to recover to 1,795.1 Mt, an increase of 4.1 % over 2020. A strong recovery in China will mitigate the reduction in global steel demand this year. The post lockdown recovery in steel demand in the rest of the world has been stronger than was earlier expected, but it still marks a deep contraction in 2020, both from developed and emerging economies, with only a partial recovery expected in 2021.”
Given all of this information, we’re confident in projecting that steel prices will continue to rise in the near-term as demand steadily rises from pandemic levels and supply lags behind.
Buying Your Building Now Versus Waiting
If you’re looking to invest in a steel building, it’s important to be aware of all of these factors, as they will significantly impact the price of your building. Steel prices are historically volatile, and the economic impact of a global pandemic have only increased that unpredictability. As you can see in our steel prices in hindsight reports above, the experts have been too conservative in their predictions going back as far as 2016. Most years they have underestimated the actual increase in steel prices by 100% or more.
Despite the downturn experienced in early 2020, steel prices rebounded and are expected to continue that momentum into mid-2021, according to several industry experts. For the best value on your steel building, it’s important to buy your building now versus waiting. Prices could double again in 2021 as they did every year starting in 2016 through 2020.
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