Increases in the price of steel could put a damper on the economic recovery, according to the Associated General Contractors of America.
“Construction put in place showed little change in January but several factors suggest trouble ahead,” said Kenneth Simonson, chief economist for the AGC . “Surging steel prices and sagging public spending may make 2004 a tough year for many contractors.”
Simonson added, “The biggest worry for many contractors today is the huge runup in the price of steel and increases ranging from 10 to 60 percent, with additional increases said to be coming at any time. Many suppliers won’t even quote firm prices, and some steel will soon be unavailable at any price. I’ve received reports in the past week of price increases ranging from 10 to 60 percent, with additional increases said to be coming at any time. Many suppliers won’t even quote firm prices, and some have tacked surcharges onto supposedly locked-in prices. Worst of all is the prospect that contractors who had counted on getting needed quantities at a date certain will be allocated only a portion of the shipment. That could throw off the timing of many other stages on a project and jeopardize the solvency of smaller contractors.”