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When Will Steel Prices Return To Normal?

When Will Steel Prices Return To Normal?

Whether you’re a regular buyer of steel or are just starting to get quotes for your next project, we bet you experienced some sticker shock when you received your last steel quote. We don’t blame you.


Since March 2020, the price of steel has gone up an astounding 215% and has continued to climb with no end in sight.


As distributors of  pallet rackingmezzaninesguard rails and many other types of steel products/services, The Safety Source is directly impacted by the price fluctuations of steel and therefore has to always keep a close eye on the steel market. We are getting asked everyday why the prices are going up so much and most importantly, when will it end?


Why Is The Cost Of Steel So High Right Now?

Like any kind of product, the price of steel is in large part determined by supply and demand. As supply decreases, the demand (and price) increases.


The current supply of steel is very low due to steel mills shutting down for Covid-19 protocols as well as a drop in demand in early 2020 due to the coronavirus pandemic, forcing steel mill shutdowns. The drop in demand didn't last long however, and the quick rebound caught steel mills off guard. Demand for steel dependent products like refrigerators, grills, and lawnmowers rose to much higher levels than normal while consumers were stuck at home due to Covid-19 protocols. The demand for steel continues to increase as the country, and the economy, reopens.


Another shortage that will greatly impact the future cost of steel, as well as availability is the chip shortage that the automotive industry is facing. Once the chip shortage is resolved, the automotive industry is expected to ramp-up, putting an even greater demand on the steel industry.


Freight costs have also sky-rocketed, partly due to labor shortages, which contributes to the overall increase in cost of steel, especially when shipped across the country.


When Will The Price Of Steel Peak?

Currently, there isn't a definite answer on when steel prices will reach their tipping point. Many forecasters predicted steel prices would tail off by the middle of 2021, but that hasn't been the case and prices continue to rise.


Should You Start Your Pallet Racking/Mezzanine Project Now Or Wait?

Now is the best time to start your pallet racking or mezzanine project. Despite the current high cost of steel, there's no telling when the price of steel will begin to plateau. It’s also possible that the material that you want will not even be available in the near future. Due to the increase in demand on steel, lead times on  pallet rackingmezzaninesinplant offices and even safety gates and guard rails are increasing by the day.



Request A Quote Today

If you're ready to start your project, request a quote with one of our project managers today!


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