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How Steel is Changing Your Bottom Dollar
The price of steel has been volatile for the past five years, plunging 25% in ’09, bouncing back strongly for two years, and then declining 3.8% annually from 2011 to 2014. That’s been helping construction costs, but nothing good lasts—IBISWorld predicts steel prices will increase 2.2% per year over the next three years. Combine that with an 8.2% annual increase in construction activity through 2017, and you’re shelling out some major dollars to the steel industry. (You can always steal your neighbors' toasters.)
IBISWorld ID’d some products that’ll be hit especially hard by the price hikes:
- Security wire fencing: Steel accounts for about 25% of the average supplier’s total purchasing costs today, and its price will leap 4.5% a year, compared to 3.3% annualized growth from ’11 to ’14.
- Nails: Steel accounts for 86% of total purchasing costs for nail manufacturers. Nail prices are forecasted to grow 3.8% per year, compared to 2.6% growth the last three years.
- Elevators: As steel comprises 35% of manufacturing costs, elevator prices are expected to rise 4.2% each year through 2017.
