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Market Update for August, Steel Price Increases

See what’s happening across commodity markets, and what’s sustaining the low-supply, high-demand scenario we find ourselves in.

Steel:

Record highs for hot rolled coil (HRC) continue, up almost to $1,900/ton and with lead times of 8-10 weeks. Demand continues to outpace supply for finished steel products, whether it’s appliances, cars, or steel pipe. Because of this, inventories are tight, and prices higher as competition for raw materials is sustained at a high level. Scheduled maintenance at HRC mills will further reduce production in the coming months.

Domestic Steel Pipe:

Due to continued escalating input and freight costs, domestic steel pipe mills have announced a 6% price increase on the products listed below:

  • 1/2” – 4” Continuous Weld Pipe
  • 2” – 18” Grade B ERW Pipe 1” – 10” Sprinkler Pipe
  • 1” – 10” Sprinkler Pipe

We will be holding current price levels through Friday, 8/20 and releasing a new domestic welded steel pipe list price sheet on Monday, 8/23. Please call your Merfish United sales representative to place orders now.

Import Steel Pipe:

Due to continued supply chain disruptions because of rising ocean freight costs and delays at ports around the country, coupled with a lack of raw material required for steel pipe production and continued strong demand, Merfish United is announcing increases of approximately 10% on import welded steel pipe products and 20% on import seamless steel pipe products. We will release new list price sheets on Monday, 8/23.

PVC:

High demand amidst strong housing starts and impending infrastructure legislation have kept the demand for PVC products high. Supply continues to be constrained as sourcing raw materials like additives and resin continues to be a challenge. Plus, labor retention has become a big issue at production facilities and distribution, making the availability of plastic pipe products tight. There’s little room for personnel-related production delays, and labor dropouts could result in the inability for inventories to rise during the slower winter months ahead of next year’s construction season. Tropical storm disruptions also remain, as Tropical Depression Fred threatens the PVC infrastructure hot-spot of the South East U.S..

Shipping and Freight:

Freight rates continue to soar as container availability decreases. Delays at receiving ports are stretching up to two weeks. Covid-19 surges at Chinese ports are creating delays throughout the supply chain. In addition to this, domestic freight is tight as trucks, and drivers, are in shorter supply, and freight companies contend with labor shortages, just like most businesses in the country.

Copper:

The long-term need for conductive materials, higher consumer demand for lower carbon energy sources, and copper mines not keeping up with consumer demand are expected to keep prices high well into the future. Are we in a supercycle?

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With us, wholesalers alleviate risk on volatile commodities. Buy what you need to service customers instead of buying large, minimum weight requirements from a mill and then waiting for delivery, leaving you susceptible to market price changes. Our quick deliveries and low minimums allow you to turn material quicker, taking advantage of price increases and minimizing the impact of price decreases.

How we can help:

Merfish United’s business model – which enables wholesalers to buy a broad array of pipe products from one supplier, at low minimums for FFA – is designed for low and unpredictable volume scenarios, exactly like the one we are in right now. Call your representative now to schedule your next weekly delivery of mixed-and-matched pipe products.

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