Are you ready for 2004 all over again? the roller coaster ride of rising steel prices and surcharges may be on its way back.
According to the Milwaukee Journal Sentinel, steel prices are rising amid tightened supplies and robust overseas demand. For industrial and warehousing operators (and for material handling companies like us) the implications are obvious: prices are going to increase and they are going to be volatile in 2008. According to the Journal, “The worst-case scenario could be a repeat of 2004, when manufacturers of many products, from automobiles to washing machines, faced severe steel shortages and record-high prices.” The price of hot-rolled steel has increased about 6% in the past two weeks. There is about a 3-month supply of steel remaining, and shortages are predicted.
The takeaway: if you’re considering a large capital project like a conveyor or rack system that utilizes lots of steel, the time to pull the trigger is probably now, not later, to avoid a large hit on escalating steel prices.