It has been a roller coaster ride, hasn’t it?
The market has been unprecedented across the board for a range of businesses. The steel industry has seen a real challenge with winning projects then finding suitable suppliers to purchase and transport steel.
We spoke to Gary Finley, the managing director of SCH Site Services about his views and opinions on the market over the last few months and where he sees it heading.
When was the last time the market was stable?
The market was stable up until around July 2020. The costs of steel then began to rise and have not really stopped.
There have been 2 price increase letters issued by British steel in the last 4 weeks alone and another one expected by the end of September.
The first was a rise of 100£ per ton and another letter this week for a further 150£ per ton. The cost of steel has reduced slightly over from July and August will now most certainly begin to rise.
What has the market been like over the last 6 months?
For those who had secured work it was just a matter of carrying on with these projects, getting deals done to ensure any hikes in prices of costs of labour were kept within budget.
The last 2-3 months have been difficult for those who did not win enough work to last. Because of the timescales, when you tender for a steel framed project it could be between 3 to 9 months before any steel is erected on the site.
This means that the cost of materials can fluctuate massively in this period which makes life difficult to make the right decisions. Pricing and quotes can change, but when a job is priced, you cannot change that, so it can lead to a loss in your business which must be avoided.
What is the market like now?
The cost of steel is rising again, and phone call are coming in asking how quickly we can get steel on site.... trying to avoid any further costs.
Why has this happened?
Simply because of the cost to build a project. I think everyone was waiting to see where the bottom was before they placed an order.
How has this affected SCH?
For us at SCH, it's not affected us to much as we have a good working relationship with all our clients and suppliers. It has been slow, but it certainly feels like it is picking up.
How has this affected steel companies across the UK?
If you read the headlines in construction, you see news of a lot of construction companies going bust, but others are thriving and making good profits, so it all depends on how you have managed your business this year
How can this be solved?
I'm not sure it can be solved anytime soon but I'm sure it will change again. There are a lot of factors making the steel and construction market difficult to navigate. What I do know is that we will continue to provide our clients our usual level of service with an honest and proactive approach.
This time next year, what would you like to see?
Stability where we dare to plan for the future and grow our people and businesses.