Ever since the COVID-19 pandemic struck at the beginning of 2020, the cost to acquire many essential materials has risen – and this of course includes the price of steel. At AST, we import our steel products from trusted suppliers all over the world, and witnessed first-hand the increased cost to purchase steel.

Thankfully, it seems that steel prices peaked around April to May 2022, and decreased in October to November 2022. However, steel may never return to pre-covid prices – and of course, they are expected to change again throughout the course of 2023.

Here’s what the experts are predicting when it comes to steel prices Australia, 2023.

Will Steel Get Cheaper In 2023?

In 2022, large corporations such as BlueScope enjoyed their largest profits in 20 years, but have stated that steel prices have been falling since. It’s predicted that steel prices will remain low in January through to February of 2023, but as they did last year, prices may rise around April or May. However, it’s not expected that they will exceed 2022 prices.

These are all predictions, of course, as prices change due not only to supply and demand, but a number of other factors as well.

What Influences Steel Prices?

There are several factors that can influence Australian steel prices. We have already mentioned the pandemic as one of the leading reasons why prices have been creeping up, but there are a few more worth considering.

Global demand and supply: Steel prices are influenced by the demand and supply of steel on the global market.

Exchange Rate

The value of the Australian dollar is one of the top influencers of steel prices (as well as many other commodities). When the dollar is weak, this can affect the price of imported steel and the competitiveness of Australian steel exports.

Energy Costs

The cost of energy has been particularly high in Australia of late, and this can add to the rising cost of steel. This is because the price of electricity and gas can have a flow-on effect, changing the production costs of steel in Australia.

Raw Materials (Iron Ore) Cost

When it comes to steel prices Australia, the cost of raw materials is a key influencing factor. These raw materials include things such as iron ore and coking coal – when the cost of these rise, so too does the production cost of steel.

Government Policies

A lesser known influencer of Australian steel prices, government policies such as tariffs and subsidies can also affect the price of steel in Australia. Economic stimulus packages from the government to incentivise building can also increase the cost of steel due to demand from builders.

Production Costs

A lot goes into making steel, and production costs certainly affect its price. These production costs include the cost of steel mills, such as labour, transportation and logistics.

Market Competition

The level of competition in the market also plays a role in determining steel prices. After all, the market follows a supply and demand structure, and steel requirements can rise when other construction materials, such as timber, are in short supply.

Is Australia Safe From Rising Steel Costs In 2023?

The global steel market is a very volatile one, and unfortunately, Australia is not immune to it. This is because Australia imports a large amount of steel – about one third of our steel is imported, with a large majority being shipped in from China. This is why COVID-19 lockdowns in China played such a huge role in the price of steel around the world in recent years.

But what about Australian-made steel? Would that not bring down the price of steel? Again, we can look to the pandemic to answer this question. Major production facilities reduced production assuming that the pandemic would affect the construction industry, when in fact the opposite happened thanks to government incentives – and then there simply was not enough steel to go around. Thankfully, with a sense of “normal” returning to the world, it’s likely that steel production will continue to ramp up and in turn the price of steel will reduce. This means that 2023 may be a more stable year in terms of costs. 

At Australian Steel Traders, we’re experts in finding the right steel products for your job: whether it be a large commercial build, or a private residential build. We keep an eye on the steel market and aim to please both suppliers and custom