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Steel Prices on a Downward Trajectory but Still Higher Than Pre-COVID Levels

In 2021, steel manufacturers and distributors experienced record profits, but those who rely on the materials for use in products and construction were stung, and deeply, by the prices they had to pay. Not only had prices spiked, but supply chain issues left many waiting several weeks or even months for the steel they purchased, backing up projects and consumer good manufacturing, particularly in areas of auto and appliance manufacturing.

The good news for fabricators and consumer goods manufacturers is that prices are on the decline for many steel products, such as coil, sheet, and plate. Still double the historical norm, prices continue to trend downward. Lead times are also shrinking. At the height of the market in May of 2021, lead times were as great as twelve weeks or more. As of this month, February of 2022, those lead times are again four to six weeks, or“normal,” at least by historical norms.

It's still hard to predict what these new facts might mean for the steel industry in the long run. We’re still dealing with the aftermath of the pandemic, with the possibility of new variants threatening to send us back into volatile markets.

However, many experts are optimistic that flat-rolled steel prices and most products made from coils will continue to drop, though perhaps not an outright plunge, throughout the remainder of 2022. Some believe prices will hit a new bottom that’s still significantly higher than those enjoyed before the pandemic, while others think historic norms are returning.

Several factors currently in play—none of which are actually COVID—could affect where those prices actually land. New competitors, import tariffs, mill consolidation, and mini-mill production all have the possibility of affecting prices in the long run, but it remains to be seen just how big that effect might be.

As a surplus steel supplier, we imagine our customers have a few questions surrounding the future price of steel. For one, does the price of new steel affect the price of surplus steel? It sure does. Those prices are reflected in our surplus stock, simply because we pay higher prices to acquire the steel for resale. However, you can always count on surplus steel to be a more financially sound option, which means you may want to plan to use it wherever possible.

Rather than ordering new steel and waiting the six-week lead time, you could get the steel you need right away. We have a vast selection already in stock and ready to go whenever you are. If we don’t already have what you need, there’s still no need to place a special order. We can find anything you need and get it loaded on the truck for you to take home faster than any mill could make it for you.

There are a lot of reasons to purchase surplus steel, even beyond the lower prices. If you’re interested in learning more, come by and see us or request a quote.