ImageFirst News

Metal Makes The World Go Around

Monday, September 24, 2018

How Metal Pricing Impacts Signs

Author: Mike McKeag

Whether you agree or disagree with the 232 tariff it is here and it affects ImageFirst™ and our customers.

Quick Overview:

This is an “executive order” based on the Trade Expansion Act of 1962.
The Senate RPC outlines 3 Main Takeaways that you can read here.

Why this is so unique: 

No one has ever worked under a tariff in this industry before so there are many unknowns. This tariff could go away as quickly as it came into being. A change of opinion in the executive branch could remove or change this executive order. This could make it hard for metal producing companies to fully invest in increasing production, infrastructure or changing business practices.

The effect on business: 

The 10% tariff on aluminum alloy has increased the cost of aluminum per pound for value-added companies. In July 2017, common alloy aluminum (this is what we use) was $1.70/lb. Today it is right around $2.60/lb. This means, everything aluminum (angle, plate, sheet, flat bar) is more than 35% the cost of what it was a year ago, which increases the price of commonly-used raw materials.

Dave Watts, of ImageFirst commented that

“this all equates to a fairly unstable market, where our suppliers guarantee pricing for perhaps 24 hours, not weeks or days. This limits our ability to keep quotes valid for too long.”

The good news, according to Pat Richards with Phoenix Metals, is

“the market is as stable today as it has been in the past 9 months.  Our mill sources lead us to believe there is a supply and that is good news.” 

What this means to IF customers:

  1. Quotes will only be valid for a maximum of 30 days, and sometimes shorter depending on raw material needs & circumstances.
  2. There may be slight price increases because our cost of goods has increased significantly.

Click here for the full US Dept of Commerce Study on “The Effect of Imports of Aluminum on National Security”

Have more questions? Email us your question.

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