Steel Building News

Rising steel prices creates cause for “clause” with building contractors

Rising steel prices have created a serious situation in the construction marketplace.  Many contractors are now being faced with “escalation clauses” in their contracts as the price of steel continues to rise.  Prices for steel have risen as much as 120 percent in the past year, which has impacted the construction industry as well as steel building manufacturers.  Material costs are no longer carved in stone at the time the contract is negotiated. At the present time, the demand for steel in the global market is so great, that in some cases, limits are being placed on how much steel a customer can order at a given time.

So why the steady climb in steel prices?  The increases can primarily be attributed to an increase in transport costs, according to a study “The Steel Surge” conducted by the industry body Assocham.  Additionally, due to a lack of major discoveries of iron ore deposits, raw materials often need to be imported.  Coking coal has tripled in price this year and in addition, iron ore has risen in price by as much as 85% according to industry sources.

Coking coal and iron ore are just a couple of the key components in the manufacturing process employed to produce that ubiquitous product we know as steel.  Outside of industrial circles, steel might just be one of the most unappreciated commodities we use every day.

The spin-off from these rising prices will continue to be felt by many.  In addition to the situations we have already addressed, other manufacturers who employ steel in their process, such as our already beleaguered oil and gas companies, will find it significantly more expensive to build new refineries and petrochemical plants.  This will translate to higher energy costs for all.

Knowing this, it makes sense to look at ways to conserve and ensure that the products we purchase will be designed and manufactured with both a view to recycling along with increased longevity down the line.

Pioneer Steel, a North American manufacturer with 28 years of experience in the steel building industry understands this concept and has made a point of employing the use of Galvalume® Plus, a superior steel product produced by Dofasco.  Pioneer Steel buildings offer twice the corrosion resistance of conventional galvanized steel buildings by combining the very best qualities of aluminum and zinc in the manufacturing process.

Pioneer also maintains a strong level of environmental responsibility by employing the use of up to 30 percent recycled steel in their products.

All of this adds up to high quality, longer lasting structures that also remain aesthetically pleasing longer than conventionally manufactured sheet steel buildings. 

In addition, as a result of innovative design and manufacturing methods, Pioneer Steel is able to ship twice as much material for their Arch style steel buildings on one flatbed as competitors can with conventionally designed products. This results in lower transportation costs and savings that are passed on to the Pioneer Steel customer.