Metal Prices

Can someone explain what I'm missing with the steel/aluminum price increase?
This is the steel price per pound index:

Prices have gone up recently but are lower than the past six years

Here is aluminum price index:


Aluminum makes sense but is still close to price in 2014.

Are tariffs actually effecting prices? Or is this just companies using it as an excuse to increase price?

 

Trump imposed tariffs and the US suppliers raised their prices to match.

 

Except for the fact that with steel prices were increasing before the tariffs went into effect. They were also coming off a record low. I wasn't in the Tacoma game in '15-'16 but if vendors are going to use "steel prices increase, so our product increased" then product must've been dirt cheap three years ago. But I doubt that. My point is that everyone keeps saying prices of steel are increasing but they've been flat lined.

 

So U.S. suppliers saw a opportunity to line their pockets and took advantage of it?

 

This point makes sense, I think. Suppliers are using this as an excuse to raise prices even though it's not necessary. Is that what you mean?

 

That's how I interpreted it.

 

They are far from flat lined we had a 100% increase in P&O sheet and a 300% increase in DOM. There is a shortage of material on US soil so they prices keep going up. You can look at those number all you want but i have seen the increases first hand. Also Id like to note the only price we raised was DOM upgrades on sliders.

Also another thing is the US mills buy raw material from "south america for the most part"and the tariffs are on raw materials as well. As soon as they were announced mutable shipped turned around and didn't bring the raw materiel as the US mills refused to pay it. Now we have a shortage.

 

With the whole tariff fiasco wasn't that about the US having to pay foreign tariff's but they were getting a free ride from us not charging one?

 

Jerry, isn't steel considered a commodity so it is traded just like any other commodity? If fears grow and money in the market starts moving it affects the price of the steel? Does this also have to deal with a while back all scrap was being sold to China and moving steel out of the supply chain in the US?

 

So what were your prices like 3 years ago? If prices actually have increased over 100% have you been underselling things in the past?

I also wasn't trying to say that your company was doing this. If you look at the first post I think I made it before you made the announcement on price changes.

 

There is all kinds of crap going on with the US and China right now its a huge pissing match that we all have to sit back and watch unfold.

 

3 years ago they were bad as well no where near today because of the shortage they are charging even more then market price with a take it or leave it attitude.

Material price has gone up that is a small amount of the cost to fabricate a part. A 100% increase on a per sheet scale is very small that's how we can keep the same price point and still make money sure a little less but it's not much. We are also kinds mass producing these parts or at least making more then one at a time that helps keep the costs down.
Another note is the small start up shops with very low overhead keep the prices down in the truck market so the larger shops just make less profit trying to keep their pricing somewhere close to what the market is paying.
It was awesome when i thought 5k to 10k a month in operating costs was a lot.

Also all of my industrial/Contract customers pay market price on material. So their part pricing go up with the steel pricing.

 

As someone who works directly in the structural steel world the tariffs are having a major effect on what we do. 3 to 4 years ago the economy was more or less stale with commercial steel. Now it has picked up with a lot of new projects creating a demand that started the prices going up. Now with the tariffs we have seen a major drop in smaller projects. Structural steel prices are rising faster that planned. We also so a major new school project get placed on hold because the cost of the steel is double what they went to bid as and the bond isn't large enough to actually build the school now. I just hope my firm and weather the storm.

 

Your charts are only showing you the cost of the raw material, not the finished plate and tubing that we buy. For whatever reason the mills are charging more for the finished plate and tubing. Same as @JLee mentioned, we are having a hell of a time finding DOM and the price has skyrocketed.

 

Aluminum is going down in price, not an all time high

Steel is back to late 2000's prices

The rest really speaks for itself

 

I wish I had more answers. I only know what we pay for these things, not what the commodity indexes say we should pay for them. I buy steel like I buy gas. I don't understand the price, I just need it so I pay what's being charged today.

 

I am with Jowybyo, the price is what it is. The price of stainless steel is unstable as hell as it bouncing (high) and all over the map. And we pay it, whatever today's price is.