Metal Price Prediction for 2023

With the new year upon us and the economy more unpredictable than ever, metal suppliers and stainless steel fabrication companies are curious about the predicted price of metal. Understanding metal pricing trends is extremely important whether you’re a buyer, supplier, seller, or work in stainless steel fabrication. While we can’t perfectly predict the future, we will give you a good idea of what metal prices will do in 2023. This information will help you and your company prepare for the year ahead and budget accordingly. 

If you need stainless steel fabrication services, look no further than Steel Specialties Inc. Contact us online or call (915) 590-2337 today to learn more!

Are Metal Prices Going Up or Down in 2023? 

In general, metal prices are expected to go down in 2023. While it won’t be true for all metals across the board, most metal prices are expected to decrease. Unfortunately, metal prices have been dropping for several years now, and the anticipated decrease in 2023 will only make things worse. Let’s look at how a metal price reduction will affect all parties involved. 

• Metal suppliers 

Low metal prices hit metal suppliers. Suppliers and stainless steel fabricators purchase metals at a low price, then sell them for minimal profit. The overall low price of metal and steel decreases profit margin.

That’s why we’ve made stainless steel and aluminum fabrication a huge part of our work. We’re the team for the job, no matter what type of steel you require or how you need it fabricated. Contact us to learn more or make an appointment. 

• Buying organizations or departments 

If you’re in charge of purchasing metal for one or more companies, low metal prices are good news for you. The only downside of low metal prices for purchasing departments is that companies might charge more for specialty products and fabrication. However, even so, low metal prices are great for purchasers. 

• Third-party purchasers

Third-party purchasers, such as HVAC or construction companies, will also benefit from low metal prices. 

• Metal Manufacturers 

Along with suppliers, metal manufacturers will feel the hardest hurt from increasing low prices in 2023. Metal manufacturers rely on selling their products for a decent profit to make money. If they cannot do so, they can’t fall back on fabrication to make additional gains. 

Price Prediction for Different Metals 

The good news about reduced metal prices for manufacturers and suppliers is that not all metals are expected to decrease. Here’s a quick breakdown of the expected price trend for different metals heading into 2023. 

• Copper – Down 

• Aluminum Ingot – Down 30% 

• Carbon Steel CRC – Down 49% 

• Stainless Steel Spot Price – Down 32% 

• Aluminum MV Premiums – 18% 

The only metal prices expected to increase in 2023 are lead, non-ferrous, and ferrous metals. Aside from those, which include most metals used in construction and similar fields, metal prices are expected to decrease. 

Will Metal Prices Continue to Decrease Throughout 2023? 

While metal prices will be at all-time lows for most of 2023, they’re expected to rise gradually throughout the year. For instance, metal is expected to start at its 2023 low point in January with an average price of $1.08 per share. However, it’s expected that metal shares will rise at an average of roughly three cents per month, putting it at $1.42 per share by December. 

Who to Turn to For Affordable Metal and Stainless Steel Fabrication in El Paso

While metal prices for 2023 seem uncertain, one thing you can rely on in El Paso is Steel Specialties. We’ve been in the stainless steel fabrication, aluminum fabrication, and metal supply business for years. Contact us online or call (915) 590-2337 today for all your metal and fabrication needs and to schedule an appointment. 

Domestic hot band prices are rolling downhill at an accelerated rate, showing no signs of slowing down yet. But how low will prices fall, and how long will it take to get there? (Whoever last checked out the crystal ball, could you please return it?)

Hot-rolled coil (HRC) prices were at $935/ton ($46.75/cwt), according to Steel Market Update’s (SMU) latest check of the market on June 6, down $135/ton over the past month and down $225/ton from the most recent high of $1,160/ton back on April 11.

Present dynamics are eerily like what we saw last summer (see Figure 1), and we all know where that led us: a low of $615/ton on average for HRC by Thanksgiving.

But in many ways, it’s not much of a surprise that flat-rolled prices are declining, especially at the current rate. Several other markers SMU tracks are trending down and have been doing so for the better part of the past few months.

HRC lead times have just dipped below the five-week mark on average for the first time since early February, presently ranging between three to seven weeks. The ongoing shift in domestic mills’ readiness to negotiate with buyers on new orders continues, a change from just 26% of buyers of hot band saying mills were willing to negotiate as recently as early April, to about 96% this week, according to SMU’s most recent survey data.

And that’s not all. Steel buyers’ sentiment remains at some of the lowest marks since December, even if it looks like it recovered slightly from a seven-month low of +58 reported in late May.

All these indicators seem to signal the present price downtrend has more room to go. I’m certainly not willing to speculate what will happen next, but all our indicators and several economic gauges seem to be pointing down.

SMU’s Steel Demand Index also indicates apparent demand for flat-rolled steel in the U.S. is in negative territory, a place it’s been since late April, and likely to contract further. The index has continued to shrink and has now been below 50 for four straight readings, which indicates contracting demand. The reading is at 42.1, down 1.4 points from late April’s measure, the lowest total since Dec. 8, when the market last bottomed out (see Figure 2).

This indicator is worth monitoring as it compares lead times and demand and is a diffusion index derived from SMU’s biweekly market surveys. This index has historically preceded lead times, which is remarkable given that lead times are often a chief indicator of steel price moves.

SMU’s demand diffusion index has, for nearly a decade, preceded moves in steel mill lead times. (Figure 3 shows the past five years.) Historically, SMU’s lead times also have been a top indicator for flat-rolled steel prices, particularly HRC prices. (Figure 4 features the past five years.)

We’ve just now started to review survey responses, but they continue to point lower, with more than two-thirds of survey respondents in our latest flat-rolled market analysis saying that prices will either bottom in July or August, with another nearly 26% expecting prices to bottom in September or later. And as for those prices, well, early survey results note that more than 65% of steel buyers expect prices to be at or below $850/ton by August.

Yet, while some sources continue to point to steady backlogs, many argue demand and output are working against each other. And as offshore product tags are dropping aggressively, raw material prices also have dropped considerably, an indication that flat-rolled prices have more room to fall.

Additionally, others would note that present dynamics in the steel market are simply a culmination of the overall slowdown in the economy. While economic pundits debate whether we are in a recession or it has yet to start, many believe that downturn will soon come to pass.

Worrisome in the near term is the fact that these indicators are pointing lower ahead of the historically slower summer period. We’re presently midway through June with a solid two months to go before the steel industry truly engages in contractual talks. Seasonality and a typical summer holiday slowdown could potentially drive demand lower, with prices sure to follow.

SMU Steel Summit

Speaking of contract talks, the premiere U.S. steel conference that unofficially kicks off annual supply contracts is just a few weeks away.

The agenda is packed full of industry experts and key players, and registrations are climbing fast. I know some of you have already registered and booked travel for Steel Summit on Aug. 21-23 in Atlanta. If so, you’re one of nearly 700 people who have already done so.

We had more than 1,300 in attendance last year, and we’re on pace to easily exceed that total. So, you may want to consider booking your hotel soon if you haven’t already. Discounted room blocks are going fast, and non-discounted prices are much higher than in past years.

You can learn more about the agenda, networking opportunities, and how to register here.