Steel instability causes and effects

What it means to you as a Cisco-Eagle customer

 

In recent weeks, everyone in any industry related to steel has heard the news about increasing steel costs. Steel companies are passing on double digit price increases, surcharges, and concerns about availability on to manufacturers of many things—including material handling equipment of the kind sold by Cisco-Eagle.

The situation may result in longer lead times for steel-intensive products and equipment. It may result in price changes that are more frequent than has been typical in recent years. We are monitoring the costs and lead times provided by our vendors closely to prevent these issues from impacting our customers any more than is absolutely necessary.

We’re committed to providing you with the most up to date information as we have it.

What’s Causing this Volatility?

There are many factors adding up to the current pricing and availability problems. As detailed in the February 20 Milwaukee Journal Sentinel, there are multiple causes. Much of the situation rests in declining availability of imported and scrap steel. Rising demand in China and elsewhere add to this issue.

On top of rising prices comes the steel surcharge, once a rarity in U.S. industry. These charges, which vary from steelmaker to steelmaker, can be invoiced after the arrival of the steel without prior notification to customers, causing instability and uncertainty on how to price manufactured steel goods.

If the economy continues to stay strong, prices could climb and shortages materialize for an extended period. If the economy slows, these issues may be minimized.

Some manufacturers are already reporting that steelmakers are refusing their orders and extending lead times. We have seen steel surcharge increases on several product lines already.

So, what can we do about it to ensure your orders and projects are covered? Cisco-Eagle has formulated recommendations & policies to ensure that we can continue to serve you with the excellence you’re used to.

If you have any questions, please contact us. We’ll be happy to assist.

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