The MMI construction (monthly metal index) held its side trend and brought down a light 1.35%. In the meantime, the American construction sector is confronted with a complex landscape formed by recent policy changes, Trump rates and other economic factors.
Steel remains a fundamental part of modern construction and plays a crucial role in buildings, bridges and infrastructure. Important materials such as H-bundle steel and steel reinforcement offer essential strength and reinforcement for dozens of types of projects. But with a newly imposed rate of 10% for the import of Chinese steel, contractors and developers will probably experience some price increases.
In 2024, Chinese steel exports climbed to 110.72 million tonnes, which reflects an increase of 22.7% compared to the previous year. This increase was largely due to the falling domestic demand, which brought Chinese manufacturers to load excess steel to the global markets. As a result, international steel makers were confronted with the increasing pressure to lower their prices to compete.
Much of the Chinese exported steel consists of construction-oriented materials, including H-bundle steel and steel reinforcement. With the enforcement of the rate of 10% on Chinese steel and the possibility of an even steeper rate of 25% on all steel imports, purchasing these materials from China becomes less financially viable.
Since the price of imported steel and aluminum is increasing due to the Trump rates, the construction sector is deleting for possible financial voltage. Many companies claim that higher costs can lead to project delays, reduced developments or increased costs that will ultimately be passed on to end users.
Owners of small companies in the construction sector, who are already struggling with strict profit margins due to persistently high interest rates, are concerned that these rates can worsen their financial problems.
Despite the immediate challenges, some industry experts claim that these rates can benefit domestic steel and aluminum sectors in the long term. By making foreign materials more expensive, policy makers want to promote domestic production, so that increased investments in American production in American production can be promoted and new jobs in these industries can be created.
For example, the construction sector saw considerable price increases during the COVID-19 Pandemie due to labor shortages, supply chain interruptions and an increased demand. In addition, materials such as steel and wood saw price increases during the pandemic that were much higher than the expected price increases among the new rates.
