Steel price development 2023 – Prices are on the rise again

After the lows at the end of last year, steel prices are now rising again somewhat.

Chart of prices for 1-month contracts in USD per ton for steel on the LME commodity exchange from September 2022 to March 2023. Steel prices are rising again. Source: LME.com

The current price of steel (March 2023)

One ton (1,000 kg) of hot-rolled steel currently costs around €900 (price for short-term contracts for hot-rolled steel on the LME commodity exchange). Prices in North America are currently slightly higher.

The indicators on the commodity exchanges are mainly for hot-rolled sheets used in automotive industry.

There are no such exchange quotations for steel beams or steel sections. As a rule, however, the prices correlate very strongly, so that the development of steel prices can be seen from them. There are also various indices for steel beams, sheet and steel profiles, but these are only published retrospectively. The steel price index therefore changes too slowly for some use cases.

Prices for steel beams and plates

Heavy steel beams and coarse plates currently (March 2022) cost about 950 – 1,300€ per ton (1,000 kg). Thinner sections and sheets cost slightly more. These prices refer to large purchase quantities and do not include transportation. The wide price range results from the different sources of supply of our suppliers from various countries.

In Germany, a ton of steel currently costs approx. 1,200 to 1,300€. See also the current steel price index.

Current prices for steel construction

In practice, steel construction is currently still more expensive than it was in mid-2021, when steel prices were higher. This is due to higher costs and good capacity utilization at job shops. However, this is currently decreasing and many suppliers have free capacities again. Quotations with very short validity periods are still common. The availability of individual materials has improved significantly and the costs for steel construction are relatively stable due to lower utilization, despite recently increased steel prices.

Stainless steel price development 2022

The price development of stainless steel depends largely on the prices of the alloying elements chromium and nickel. The most commonly used stainless steel grade 1.4301 (also often referred to as V2A or AISI 304) contains approx. 18% chromium and approx. 9% nickel. At currently around €22,000 per ton (1,000kg), nickel is more than ten times as expensive as steel and therefore has at least the same impact in weighted terms. The price of chromium is around €3,000 per ton.

After the start of the Ukraine conflict in March 2022, there was a jump in nickel prices. This price increase was caused by speculation and got the London commodity exchange LME into trouble. In the meantime, the nickel price has stabilized again.

Current prices for stainless steel sheet and profiles

1.4301 (AISI 304, V2A) – from 3,24 €/kg
1.4401 (AISI 316, V4A) – from 4,49 €/kg
1.4541 (AISI 321, V4A) – from 4,39 €/kg

Steel price forecast for 2023

The war in Ukraine shook the raw material markets. In addition, short-term speculation with rising raw material prices further fueled demand and motivated many steel processors to fill inventories. The highs reached during the Corona pandemic in the region of €2,000 per ton (1,000 kg) were not exceeded. The market did not seem to accept higher prices. Thereafter, a countermovement occurred and prices provisionally bottomed out at the end of 2022. Since the beginning of the year, prices have been rising again.

In view of general inflation, steel prices are currently favorable. A further drop in steel prices can only be expected in the event of a severe economic downturn, although the lower limit is likely to be in the region of €500 per ton. At the moment, the high energy and raw material costs do not actually give producers much leeway.

The current situation in Ukraine and in particular its impact on the energy market remains the determining factor for producer prices and is causing volatility and overreactions on the market. It is therefore very difficult to forecast steel price developments for 2023.

Prices for container freight strongly declining – Europe routes cheaper again

The CCFI is an important price index for the container transport market for global container shipments to and from China. After reaching an all-time high at the turn of the year, it is now approaching its pre-Corona pandemic level again. However, the index includes all major transport routes and the decline was smaller for shipments to Europe for the time being. Now container prices have also returned to normal on the Europe routes.

In cooperation with Qianxin Mechanical Technologies in Shanghai we can support you in sourcing steel components from China.

The CCFI during the Corona Pandemic. Source Shanghai Shipping Exchange

Zinc prices increase the cost of galvanized steel construction

The cost of galvanized construction continues to be fueled by other factors. In addition to rising energy costs, zinc prices also rose. Here, too, the highs seem to have been overcome.
On the stock exchange, for example, a ton of zinc recently cost around €2,900, after a short-term peak at around €4,000. A year ago, prices were still around €2,000 per ton. For galvanized steel construction, the cost of galvanizing accounts for up to 25% of the total price.