The cost of steel plate and other steel materials is complex and fluctuating, as there are a number of factors that can impact price.
Steel is typically priced by hundredweight (CWT), which is the price per 100 pounds of material. In some situations – such as materials market reports – carbon steel price may be reflected per-pound. For example, a CWT price of $40* is equal to $0.40 per pound.
To complicate pricing more, units are often quoted in tons, with 1 ton equaling 2,000 pounds.
So, for example:
2,000 pounds = 1 ton = $40 CWT x [2,000 pounds / 100 pounds]
1 ton = $800*
*The price used in this example is arbitrary and not based on current market levels.
With this in mind, let’s move on to exploring factors that impact steel plate price. For a quick, condensed overview of these factors, view our "Cost of Steel Plate" infographic here.
Steel is a basic raw material that is dictated by the laws of supply and demand, which results in an average market price. Excess supply leads to lower market prices, while limited supply drives market prices higher.
Supply and demand are the most important factors in determining the price of steel at any given moment in time. These market prices change from day-to-day, and sometimes multiple times per day.
Day-to-day fluctuations in price are typically small, meaning it won’t greatly impact the cost of small-to-medium-sized projects. However, for large projects – let’s say a project that requires 10,000 tons of steel – a $1 increase in CWT would add $200,000 to the bill.
Let’s now explore the factors impacting daily steel prices.
Someone buying a car can expect to pay more for a top-of-the-line SUV than they would a compact economy vehicle.
The same is true with steel. Certain grades are inherently more expensive than others.
In general, the CWT increases as the steel grade becomes more specialized – either by adding alloys or using quenched and tempering processes to harden the material.
Below are general steel material categories, ranked from lowest-price to highest.**
**There are exceptions within each category. For example, A656 is a specialty High Strength Low Alloy grade, but is priced more in the range of Quenched & Tempered grades. Conversely, AR-Medium is an Abrasion Resistant grade, but its pricing is more in the range of Pressure Vessel Quality grades.
When soliciting quotes for a project, understand that certain grades will have a higher CWT than others. A full quote should list CWT for each grade. If it does not, it is certainly acceptable to ask. This can help you compare apples-to-apples between quotes.
As with anything, buying in bulk often lowers per unit costs. The same is true with steel.
When buying in bulk (which is roughly 22 tons or greater), suppliers can build time savings (such as speed and human resources) into CWT.
Additionally, bulk orders enable the supplier to buy in larger bulk from a mill manufacturer, which sees similar time-savings advantages that are passed on through their CWT.
Don’t have a bulk-quantity need? No problem.
Your needs over time can still impact CWT price. Someone who needs one piece of AR500 steel plate for a target practice backdrop has less future need than someone who requires one piece of AR500 per month for five years.
When submitting your project needs to a steel supplier, be sure to indicate future needs, even if buying in smaller quantities. This insight will help the supplier offer a more accurate quoted price on this and future orders.
The country of origin where the steel material is produced can play a large factor into overall CWT price. Some projects require specific countries of origin to meet quality requirements, but others can be more flexible about where the material originates.
Look for suppliers who source from domestic as well as international mills. These suppliers are more likely to have a wider price range of steel material, giving you more options when you buy.
Requesting steel material that is cut, drilled or cleaned will likely add to overall cost, but may reduce CWT if the steel supplier can handle these requests in-house.
Related: Common Ways Steel Plate Is Processed
By bundling a material order with a processing request, suppliers may have more wiggle room with CWT. Be sure to mention any processing needs you may have with suppliers as you solicit quotes.
It is costly – in both time and dollars – to transport steel material due to size and weight. For this reason, quality steel suppliers have distribution centers in strategic cities across North America. This allows the supplier to deliver steel faster and more economically to customers across the continent.
A few suppliers build transportation cost into CWT, but most tack it on as an additional expense. When evaluating steel material quotes, be sure to understand how transportation will impact your total cost.
Occasionally, a steel supplier may have too much of a non-standard size or grade and will slash CWT in order to move the material (and clear warehouse space for more popular sizes and grades).
If a project has flexibility around a size and/or grade, it is certainly worth mentioning as you solicit quotes.
When sourcing steel materials, partnering with a niche supplier can save greatly on CWT. For example, Leeco® Steel specializes exclusively in supplying steel plate. Because this is our focus, we can be much more competitive on steel plate pricing than someone who supplies a more mixed variety of steel products (i.e. bars, coils and sheet).
However, sometimes your project requires more varied material types. In these cases, you should evaluate the time saved by working with a general “one-stop-shop” supplier and if it outweighs the CWT savings that can be offered by a niche supplier.
How could we not mention the elephant in the room? Market regulation can greatly impact global and domestic CWT.
The most recent – and visible – example being the U.S. tariffs placed on imported steel and aluminum in June of 2018. The tariffs made buying steel and aluminum with non-U.S. origins significantly more expensive. The result was a greater demand for U.S. steel (by American buyers). Basic macroeconomics took hold: greater demand lowered the supply and increased prices.
Another related – but perhaps lesser known – variable is government subsidization. For example, the Chinese government subsidizes Chinese steel producers, allowing Chinese steel to be priced below what it actually costs to produce. This form of regulation caused a depression in steel prices worldwide.
Whatever the regulation, it can have a major impact in CWT across the board.
Unpredictable and unstoppable, natural disasters can be devastating. Communities find themselves needing to rebuild buildings, bridges, utilities and more.
In the wake of natural disasters, demand for steel material needed for rebuilding can push prices temporarily higher across the market. These instances are – thankfully – rare, but natural disasters remain a significant factor in determining steel material price.
Despite touching on ten factors that impact steel material pricing, this list is not exhaustive. However, armed with a better understanding of the major players in steel material pricing, you are better equipped to find the right steel material supplier for your project needs.
We encourage you to submit your projects that require steel plate material to Leeco Steel for quoting, as we offer some of the most competitive steel plate pricing in the U.S., Canada and Mexico. Use our simple quote builder tool or submit your list of requirements to Leeco Steel today.