Steel is used to create a variety of equipment and items, from simple nails to huge construction equipment. It is a manufactured material that is critical to daily life and is in constant demand. Though steel is needed on a regular basis, supply and demand fluctuates. With this constant changing comes shifts in steel prices.

Low supply with a high demand will drive the prices of steel upwards, whereas high supply with a low demand will bring the prices down. Many who are interested in purchasing a steel building do their research and watch the prices of steel over a period of time, waiting for the best opportunity to purchase their materials. Low costs of steel offer a great opportunity to purchase a good quality steel building at a great price. Here are some factors that influence the price of steel buildings.

Costs of Materials

Most building manufacturers purchase their raw materials from refining or mining operations. Scrap metal and iron ore are two of the main elements that are used to create steel. If these resources are in limited amounts, the demand from the manufacturers will exceed the supply, driving up the prices of their total raw material costs. This is reflected in the purchase price of the finished product: the steel building.

Supply and Demand

As with any business, supply and demand has a huge influence on prices. When less steel is available, consumers can expect the prices to rise. Some areas are using more steel than others, driving up those specific prices. Countries around the world who are seeing stagnant growth will not produce as many raw materials. This also drives up steel prices.

Costs of Shipping

Many factors influence the cost to ship raw materials and steel products. Politics and the cost of fuel and labor are just a few of the major factors. High shipping costs influence supply and price of the finished materials. It is very difficult and dangerous to ship some materials through certain geographical areas of the world, due to piracy, natural disasters or terrorism. These threats force shipping companies to raise the costs of transferring goods. This creates a trickle-down effect. High shipping ultimately leads to higher prices in steel.

Historical Trends

Buyers of steel buildings are not the only group who follow the fluctuating prices of steel. Since the steel market is considered mature, meaning that the material has been sold over an extended period of time, it is easy for experienced manufacturers to pick out trends and change their prices accordingly. When builders of steel buildings notice that the prices of steel are being influenced by other sources, they can manipulate the prices of their finished materials to match the market price of steel before the trend sets in.

Costs of Energy

The final factor that influences the market value of steel is energy costs. The more that it costs laborers to retrieve and create products, the higher the price of the final product. As energy prices increase, consumers can expect them to play a role in the cost of steel buildings.

Low steel prices provide buyers with a great opportunity to purchase a steel building that will be perfect for their desired uses. For more information, contact the professionals at Renegade Steel.