What’s Trending in the Metal Markets in 2021?Leave a Comment
With more than 60 years of experience, Manor Tool & Manufacturing has become a trusted metal stamping and fabrication provider, specializing in deep-drawn stamping and progressive die stamping services using steel, aluminum, brass, and many other materials. From prototyping to high-volume production runs, we manage even the most complex projects at competitive prices. Through the years, we’ve grown and adapted to a number of the metal markets and fabricating trends and technological advancements, and 2021 will be no different.
Here’s a closer look at what we’re anticipating for the industry and in the metal markets this year.
What’s Affecting the Steel Market for Fabricators in 2021?
Steel took a dive with the rest of the economy when COVID-19 hit last year, but it made a remarkable recovery by December. At about $900 per ton, the cost had doubled in just four months and continued its rise to reach a record high in January.
This price jump occurred due to high demand and short supply. Steel mills dramatically slowed production during the second quarter of 2020. Many businesses were forced to shut down during this period and U.S. steel producers haven’t all ramped up sufficiently to meet the growing demand for steel as of yet. Meanwhile, high tariffs enacted before the pandemic make it challenging to import steel, leaving many companies without a source.
Demand for steel is expected to remain high. The economy as a whole is rebounding more quickly than expected, and steel is needed for automotive production, infrastructure projects, construction, consumer goods, and many other industries currently experiencing demand spikes. We expect prices to remain high until the mills can produce enough steel to balance the demand. While there are several mills in the process of expanding their capabilities – which will add more than 7 million tons of steelmaking capacity to the market – we likely won’t see the results of that until the end of the year, or even into 2022.
While there is some concern that a massive increase in steel availability could cause the price to drop sharply, it’s likely that even that much additional steel won’t outpace the growing demand. Prices could remain high for several more months at least. There are several other factors at play, as well:
- Steel users may seek alternate material options
- Low import levels
- Potential changes to trade policies and tariffs with new administration
A Review & Forecast of Aluminum
Though aluminum hit a four-year low in April — another slump attributed to diminished production during the pandemic — it has been on a generally upward trajectory ever since. Aluminum manufacturing in the U.S. is expected to rise 2.3 percent, while worldwide demand is expected to grow by 4.5 percent this year. Much of the global demand comes from China during their post-lockdown growth in construction and infrastructure. Trade restrictions between the United States and China are likely to continue in some form for the time being, which will impact the supply and cost of aluminum for U.S. buyers.
About Manor Tool
Undoubtedly, 2021 will present challenges and opportunities for the metal fabrication industry as indicated by the unpredictability of the metal markets. With our years of experience, extensive capabilities, and dedicated team of skilled professionals, Manor Tool will be here to meet your metal stamping needs with precise, cost-effective solutions in our 44,000-square-foot, ISO 9001:2015-certified facility.
Please contact us or request a quote to learn more about our extensive metal stamping and fabrication capabilities.