Does War in Ukraine Impact Metal in Texas?

What impact might tension between Russia and Ukraine have on the metal supply here in Texas?

Consider the following:

• Global event: Multiple carbon steel mills announced price increases on sheet products, citing concerns that the war could disrupt global supplies of the raw materials used for making steel.

  Local impact: Your cost to purchase carbon steel increases and the risk of supply scarcities re-enter the picture.

• Global event: On March 8, the price of nickel more than doubled to surpass $100,000 per metric ton on the London Metal Exchange. This suspended trading for multiple days due to what some were calling “panic buying” running up the price.

  Local impact: Nickel is a primary ingredient in the production of stainless steel and impacts the surcharge on this material. That cost ultimately trickles down to the end buyer of stainless products.

• Global event: The price of crude oil jumps on news of U.S. ban of Russian oil.

  Local impact: The Midwest Premium, which is the primary logistical cost factored into shipments of aluminum, hit record highs due to the rising cost of fuel.

Next Energy Up?

You probably don’t think too much about the cost of thermal coal. But as global tensions continue to play out, and the chance of energy shortages increase, old school fossil fuels like thermal coal could be an alternative.

But don’t expect a big price relief compared to other forms of energy. A look at the chart below shows the price of both thermal coal, which is typically used to heat homes, and metallurgical coal, used in the manufacturing metal, have risen to historic levels in recent weeks.

How Far Will Fuel Rise?

It’s no secret that the cost to drive from job to job has increased. Average gas prices in Texas hit $4/gallon for regular unleaded fuel on March 10. According to AAA, this is up $1.45/gallon compared last year.

Those fuel costs are hitting metal deliveries as well. Diesel prices are up 13.6% since the beginning of the year and 33.6% from the year-ago period. As depicted in the chart below, a rise in price began around mid-January, but has accelerated as of late due to global events

Fuel price figures based on U.S. On-Highway Diesel Fuel Prices from the U.S. Energy Information Administration.

Market dynamics are constantly changing, but SteelNow can help get you the metal you need. We’ve built relationships with nearly 60 metal suppliers across the great state of Texas. We call it a metal-buying network designed to help metal reach you more efficiently.

Here is how it works:

1. Contact SteelNow! Let us know what type of metal you are looking for.

2. We’ll track down the product you need from one of our suppliers – at the best price and lead time for you!

3. Get a quote from us – if all looks good, time to place your order

4. We’ll handle it from here! Whether you need, for example, sheet metal delivered or something else picked up at a local warehouse – we’ll arrange procurement and get the metal to you.