How Steel Pricing Works

YRG steel
Yard Ramp Guy: Steel Watching

Or: Steeling for Fluctuations

The majority of our buying and renting customers prefer portable loading docks made of steel. While aluminum is not as prone to rust or corrosion, steel is the stronger metal. It is significantly more durable than aluminum so yields a longer useful lifespan.

And while a completed loading dock can involve a number of components, from rubber to rivets, the greatest volume of material is steel.

Therefore, steel cost factors into the price of a portable loading dock more than any other element, including labor.

That’s where things get a bit complex. Steel is considered a global commodity—traded worldwide like copper and coffee. In the global arena, steel prices fluctuate on a daily basis.

Generally, the rules of supply and demand drive the rates of steel. In a nutshell, here’s the basic law of supply and demand:

  • If the Supply is up, the Demand and Price are down.
    Yard Ramp
    Steel: The Dock's Foundation
  • If the Supply is down, the Demand and Price are up.

Steel prices reached an all-time low in of $365 per tonne in March of 2016, down from a high of $749 per tonne in 2011. China, the world’s largest producer of steel, for many years has also been its largest consumer of steel, and supply has outpaced demand.

With China now scaling back on infrastructure projects—due, in part, to its economic slowdown—the country will also scale back its production by some 20% (except for, we kid you not, its construction of ballpoint pens; click HERE for a fascinating story). As such, economists predict, demand for steel will outpace supply for the first time in some ten years.

Naturally, that may well have an effect across all industries that rely on steel production, including the loading dock industry. Pricing structures would be informed by manufacturers, which would be informed by purchasing power—all of which aligns with the laws of supply and demand.

The Yard Ramp Guy continues to monitor the situation closely.

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Quotable

Okay, McCoy Fields . . .continuing our alphabetical quotation challenge, we B presenting this:

Baseball is ninety percent mental. The other half is physical.Yogi Berra

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