26th April 2022
Steel Price Surge
Author: Wakefield Acoustics – Noise Control Specialists | Last Updated: April 2023
Over the past few years, the word ‘unprecedented’ has become synonymous when describing the COVID pandemic and with the fuel and food price escalation. In recent weeks, as an industry, we have faced another ‘unprecedented’ situation in the European steel market, a key raw material for our products. The driver for this has been the war in Ukraine.
Pre-galvanised sheet steel and mild steel hollow section is a key material in our range of acoustic enclosures, containers, acoustic louvres, attenuators and acoustic screen products, and as such, price fluctuations in steel are very much in focus at present.
Prior to the Russian invasion, steel stocks were relatively high, and the outlook was positive following cost increases we had seen during the course of 2020 and 2021, and prices had even begun to reduce. However, following the start of military action, steelmakers had to re-evaluate their production plans and prices.
Steel from Russia, Ukraine and Belarus is a key part of the European supply chain, with these countries being responsible for almost one-quarter of finished steel imports into the EU and UK, and 80 per cent of semi-finished steel, according to the latest MEPS European Steel Review. Due to the conflict, Russian-origin imports of key goods in the iron and steel sector were prohibited from mid-March.
Current forecasts indicate that steel prices may peak in June and July this year, though long-term fixed pricing from stockholders is not available due to the fluidity of the current situation.
These global issues put additional pressure on manufacturers who had already lived through COVID-related lockdowns, and who were starting to experience an upturn in demand for their products and services. Where fixed-price contracts have been entered into some time ago, there can remain little scope to pass on increased prices due to raw material cost increases. A situation is being felt across the wider construction and manufacturing industries. For projects not yet secured, some clients are asking for revalidated prices on a regular basis to keep up with the material cost changes.
On a positive note, successful manufacturers such as Wakefield Acoustics, are benefitting from a continued high level of demand for products and services, which appears to be continuing despite the price increases. Wakefield Acoustics are continued to be supported by our valued supply chain which works with us to maintain the most competitive pricing levels and good material availability.
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Wakefield Acoustics have extensive experience in providing bespoke solutions for general industrial applications: