What is the Impact of COVID-19 on Steel Prices?

COVID has an impact on almost every industry across the globe. Steel is one such commodity where the effect of COVID pandemic is also seen. Steel prices have touched new heights in the last few months, and that directly impacts metal building prices.

Many of you would think that COVID has a direct impact on steel price hike. Instead, numerous factors are included; some are direct and some are indirect.

Steel is a global commodity that is used for numerous purposes. Metal buildings are a prominent niche where steel is in huge demand. However, steel price fluctuations cause changes in metal buildings. Increased steel prices cause an additional burden on buyers’ pockets.

Below listed are factors that influence steel prices.

Global Economy Health: health of the global economy has a direct impact on steel prices. Like steel, all other commodities are affected by the current status of the global economy. If the economy is at the correct pace, steel prices will remain unchanged (even price low).

Forecasted Supply and Demand: Demand and supply directly impact steel prices. If demand is high and supply is low, it directly elevates steel prices. On the other end, if supply is high but demand is less, you can get raw steel at a lower price.

Industry Trends: Auto industry, Construction, Packaging: Steel production is influenced by numerous other industries like the auto industry, construction industry, and packaging industry. They cumulatively generate demand and supply ratios and conclude final steel pricing.

Cost of Materials: Scrap Metal and Iron Ore: What’s the cost of raw material used for steel production? Current price of raw materials influences steel prices.

Strength of American Dollar: What’s the current price of the American dollar w.r.t global currencies? Strength of the American dollar ensures low steel prices and vice-versa.

Natural Disasters and Pandemics:  current COVID-19 is a situation that has also affected steel prices. Similar to COVID, other natural calamities affect steel prices.

Many of you already know that China is the largest steel exporter. As the largest steel producer, trading companies consider its price according to China’s currency, i.e., the Yuan.

You can simply use a currency converter to find the current price of steel in your area. An online exchange rate can help you find its local price.

How COVID affected Steel Industry in 2020?

Impact of COVID pandemic globally is known to everyone. The steel industry is no different. During the pandemic period, China was able to increase its steel production by 4.9%. It means steel production remains unaffected in China.

However, other countries across the globe were affected. Countries like the USA, Japan, EU experienced a dip of 20%, whereas Indian alone witnessed a dip of 14%.

How Steel Price Hike Affected Metal Building Cost?

As mentioned earlier, the steel price hike directly influences metal buildings you order. Since the early months of 2021, metal building manufacturers have updated their prices due to steel price hikes.

This price hike has added a burden on customers as they have to pay higher than before.

According to statistics, in 2021, steel demand is expected to increase by 8%. However, steel supply should also increase to bridge the gap and bring down steel prices to a reasonable level.

Planning to purchase a steel building in the coming months?

If you are planning a metal structure for your land, you must know that steel building price isn’t only affected by steel price. Instead, other factors also affect final pricing.

Building Styles: You will be charged higher for big buildings. A standard metal carport will cost you less compared to a commercial building.

Building Size: The size of your metal building is also a strong factor that decides the final price. A two-car garage will cost you higher than one car garage.

Roof Type: Metal building comes with three roof options, i.e., regular roof, A-frame roof, and vertical roof. Vertical roof is priced higher than the latter two options.

Customization: If you are planning to add accessories or customize your existing structure, the final price will increase.

Geographical Location: Metal building delivery is affected by the distance from the manufacturing unit. Hence, for far deliveries, you might pay a higher cost.

Insulation: Different insulation options have different price tags. Hence your selection of particular insulation will bring change to the final building price.

So, these are influencing factors that alter the final steel building price. However, these pointers are under your control, and you can make smart decisions to get the best building without puncturing your pocket.

What are you waiting for? Viking Steel Structures ensures you get the best and highly competitive priced metal buildings in the shortest lead time. Give us a call at 877-801-3263 to discuss your custom requirements.