Steel Building Prices – Post Election 2016
It's hard to believe that it was only last summer that we were subjected to both volatility in steel building prices and the summers most popular reality television show, which masqueraded as the Presidential election. As the summer began to wind down, so to did the volatility in steel building prices - but not after leaving us with multiple steel building price increases to deal with. At the same time the summer was winding down, the 2016 election was heading full speed toward the finish line.
One of the major themes in the final election push was the issue of trade, unfair trade, trade regulations and bad trade deals, and how a combination of these things resulted in the elimination of tens of thousands of blue-collar jobs. President-elect Trump used these issues masterfully to energize and mobilize voters and focused his efforts in the rust belt states of Ohio and Pennsylvania. These states, at one time, produced the vast majority of the world's steel. President-elect Trump promised voters in these states that he would do everything in his power to address the inequalities of trade policies that resulted in them being stripped of their livelihoods and their region being labeled the rust belt.
With any Presidential election, the face of the campaign doesn't always become the face of the Administration. But if this election cycle proved anything - it was that it was anything but typical. So with the inauguration of President-elect Trump a month away, will the new Administration put into place policies that are going to have an impact on steel building prices? I think it's safe to say, yes. If the Administration seeks to stem the flow of cheap subsidized imported steel, it will likely put policies in place to increase the cost of imported steel - resulting in a shift in demand for domestic steel which will show an attempt to carry one of the pillars of his campaign into his Administration. A recent article in the Pittsburgh Post-Gazette, by Len Boselvic, estimated that up to 10,000 steelworkers might return to work within the United States steel industry as a result of the new Administration and it's anticipated focus on unfair trade. In addition, the Administration's desire to lower taxes and reduce business regulation will further stimulate demand for steel as growth results.
It's safe to say that the handwriting is on the wall as far as an increase in steel building prices is concerned. The only question now is how much of an increase we'll see.