Why Steel Prices Fluctuate and How to Track Them

Why Steel Prices Fluctuate and How to Track Them

Steel, the primary material for our steel edging systems, experiences steel price fluctuations due to global economic, industrial, and geopolitical factors. These changes directly affect the cost of our products, making it important for us—and our customers—to understand the forces at play.

Factors Influencing Steel Prices

1. Global Demand and Supply:
• Industries like construction, automotive, and manufacturing heavily influence steel demand. A surge in projects or shortages in supply can drive prices up, as seen during post-COVID recovery periods.
• China's dominant role in steel production means that changes in its policies or output levels can significantly impact global prices. None of our steel comes from China. However, because they are a big producer, they do affect global rates.
• Chinese steel is often used by some UK steel edging system suppliers.  It’s worth asking the question!
2. Raw Material Costs:
• Steel production relies on iron ore, coal, and scrap metal. Fluctuations in the availability or price of these inputs influence steel costs.
3. Energy Prices and Logistics:
• Steel manufacturing is energy-intensive. Rising energy costs or supply chain disruptions, like those during the pandemic, lead to price spikes.
4. Geopolitical Factors:
• Tariffs, trade restrictions, or economic sanctions can affect steel availability and pricing. For instance, tariffs on imported steel contributed to domestic price increases.
5. Seasonal Demand:
• Construction activities often peak in warmer months, leading to higher steel demand and prices.

Recent Trends

Over the past two years, steel prices have been volatile:

• In 2021, post-pandemic recovery and supply chain constraints caused a surge, with hot-rolled coil prices reaching record highs.
• Prices moderated in 2022 as demand stabilized, but uncertainties in the global market, such as the Russia-Ukraine conflict, caused renewed fluctuations​

 Procurement Resource - Fastmarkets

How We Mitigate Price Fluctuations

At Garden Edging Online, we buy steel in bulk, allowing us to maintain more stable pricing for our edging systems. While this helps buffer some volatility, broader market trends inevitably influence costs.

Tracking Steel Prices

Businesses and consumers can monitor steel prices through:

• Industry Reports: Platforms like Fastmarkets and SteelPrices.com provide real-time updates and historical data.
• Commodity Exchanges: Steel futures on exchanges like the London Metal Exchange offer insights into expected price movements.
• Government and Trade Reports: National economic indicators and policies give clues about market trends.

Tracking steel prices and understanding these trends helps us provide transparent pricing to our customers while planning for future demands in our steel-based products.

If you'd like to learn more about how steel prices impact our product costs or how we manage these fluctuations, feel free to contact us!