Steel Availability Remains Strong Despite Recent Price Increases
January 29, 2004 From American Institute of Steel Construction, Inc.
As a result of increasing international demand for steel scrap, most domestic steel mills have recently increased their prices and have imposed a “Raw Materials Surcharge” on all steel products, including wide flange and rebar. Despite the recent price increases, it is important to note that after adjusting for inflation, the mill price of structural steel today is still less than it was two decades ago.
“Raw material costs are only one component in the price of a steel building,” noted H. Louis Gurthet, P.E., President of the American Institute of Steel Construction, Inc. “The impact on the price of a fabricated and erected steel frame is far less.” Even with the increases, steel still represents only around 20% of the final cost of the frame and just 3% of the total building cost.
While steel mills are paying more for scrap, wide flange is readily available from steel mill production and service center inventory. In fact, domestic production of wide flange today exceeds domestic demand. In 2004, the domestic market for wide flange material in buildings is forecast at 3.6 million tons and domestic producers have a capacity of more than 6 million tons. In addition, there currently is an estimated 800,000 to 1 million tons of structural steel in service center and mill inventory.
AISC is currently working with steel producers and others to better understand and predict worldwide scrap pricing and the resulting indexed surcharges.
For more information contact:
VP of Communications
American Institute of Steel Construction
The American Institute of Steel Construction, headquartered in Chicago, is a not-for-profit technical institute and trade association established in 1921 to serve the structural steel design community and construction industry. AISC’s mission is to make structural steel the material of choice by being the leader in structural steel-related technical and market-building activities, including: specification and code development, research, education, technical assistance, quality certification, standardization, and market development. AISC has a long tradition of service to the steel construction industry of providing timely and reliable information.
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