February Market Minute 2023

The State of Steel Prices

Steel prices continue to ride the roller coaster of volatility early in 2023.

As of February 17, hot-rolled steel prices eclipsed $800/ton and are up 15% since the start of the year. Much of this can be attributed to price increases announced at the mill level—five increases on sheet prices since November 2022, totaling $260/ton. 

On the steel bar side, MBQ (merchant bar quality) is down $70/ton since November. Prices on the hot-rolled SBQ (standard bar quality) side, however, are going up. Increases have been announced by mills on all sizes, shapes, and conditions, effective Jan/Feb 2023.

The Turbulent Tale of Nickel and Moly

Volatility in both nickel and molybdenum prices continue to impact the price of stainless steel surcharges. Since November, 304 and 316 surcharges have risen 25% and 39%, respectively.

Surcharges can vary based on a myriad of factors, most notably the price of five key alloying elements: nickel, chrome, molybdenum, manganese, and iron.

The expectation is that the price of nickel will even out soon, but the uptrend price in molybdenum is expected to remain.

Can Shortage Threatens Aluminum Production

Roughly 2 million tons of aluminum capacity is set to come online over the next three years. Typically, this type of announcement is perceived as good news—but some experts believe this could have the opposite effect on aluminum.

Three new mills set to come online will each emphasize scrap consumption in its raw material mix. But that type of scrap has been hard to come by, due primarily to a shortage in aluminum cans. An alternative may be shredded automotive scrap.

For now, availability constraints that plagued aluminum for much of 2022 have somewhat abated. Grades like 5052 and 3003 remain readily available, but heat-treated grades, such as 6061, remain limited.

The aluminum market is certainly one to watch in the months ahead.

Rebuilding with Steel

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According to a report from the Greater Houston Partnership, $33.91 billion in construction contracts were awarded in Houston between January and October in 2022, compared to just $26.6 billion awarded during those same months in 2021.

If you’re building in 2023, you’ll likely be in the market for steel or other metals used in construction. As you juggle deadlines and the procurement of resources for each job, tracking down the right metal can be a time-consuming process.

But it doesn’t have to be. Read more about how we can help on your next construction project.