2021 Q1 Market Update

January 18th, 2020
With the global economy recovering, the market wide pricing of metal is expected to continue to rise during the first quarter of 2021. Aside from increasing demand, other regulatory & political factors are also driving up the prices of various metals.  Below are overviews of each of the Aluminum and Carbon markets including an outlook for what the first part of the year may hold for metal buyers.

Aluminum Market

Over the next couple of months there will continue to be a supply shortage for Common Alloy Sheet (3x and 5x) within the US due to Anti-Dumping Lawsuits filed in 2020 by the US Commerce Department against 18 foreign nations. The uncertainty of the lawsuits’ outcome has impacted the availability of products, which has translated into supply shortages and price increases.  A potential settlement of the lawsuit late in the first quarter can significantly impact the current situation, but at this point there is no prediction as to how it will.
Base prices for extrusions increased January 1, 2021 due to increased production costs, including labor, energy, and transportation.  The growing global demand driven by the recovering economy has also impacted costs affecting both the LME and MWP. At this time there is no indication when prices for these alloys might level out as demand continues to rise worldwide.

Carbon Market

Carbon flat roll prices have increased by more than 40% since August 2020.  The price increases are a result of low supply, due to the slow restart of blasted furnaces that were paused during the earlier stages of the pandemic, low inventories and a faster recovery than expected. This has greatly limited steel supply in the US. Import supply has been adversely affected by The US tariffs (Section 232) and an improved global economy.  Section 232 has affected prices and supply while some countries are subject to a 25% tariff on steel, and others countries like Brazil have quotas in place. Since carbon tubing is manufactured out of carbon flat roll, prices for these metals are also expected to continue to rise.


With carbon flat roll on allocation, limited 5052 import available at this time, metal prices on the rise and COVID-19 adversely affecting short term economic trends, one might have concern over what is ahead for the US economy. But if the metals market is any indication, the long term prospects for the economy are looking up.
Commodities are often strong indicators of where the market is headed. When US economic growth slows so does the demand for building materials, infrastructure and tech. The demand for metals which are used in all of these applications also slows and prices decrease. With investors currently driving up the prices of commodities including metal, it often means they expect an economic rebound with more manufacturing in the near future.
Please note that the metals market is constantly changing and significant changes to metal pricing & pricing trends can occur at any time. Industrial Metal Supply is supplying this information as a service to its customers and this information does not constitute financial or purchasing advice with regards to the metal market.

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