March Blog – Steel Market Update

Steel Market Update

On 28th February 2022, all major steel mills, including Tata, SSAB, Thyssen and NLMK, immediately closed their order books.

The reasons put forward included:
• Soaring gas and oil prices
• Sanctions having been placed on Russia
• Metinvest suspending operations at two mills, which produce 40% of Ukraine’s steel.
(Both Russia and Ukraine provide significant raw materials to European mills)

As a direct consequence of the above, stockholders across the country have either closed their order books or hiked prices up. The price increase was initially 20% overnight but the costs have since been increased to 35-45% above the average cost of February stock.

Many stockholders report that buying activity during the last week is greater than that of the previous two months combined. As a result, stocks are becoming depleted and delivery lead times are exceeding two weeks from most stockholders.

In response to this, Grenville has increased its steel stock to mitigate the risk of any impact to customers. Despite this, and having worked hard to buy at the most competitive rates, our prices to you will undoubtedly be affected.

Moving forward, we strongly recommend that any projects you may have are brought forward. It’s important to note that the stockholders suggest that prices could rise by another 20-30 % between now and May 2022.

Please be rest assured that we will be taking a proactive approach to sourcing steel and working hard to ensure our customer’s requirements are met.

We endeavour to keep you updated but should you have any questions, please don’t hesitate to contact us.

Grenville Engineering (Stoke-on-Trent) Ltd