By: Derrick Caudle
The consensus regarding 2021, from most in the HVAC industry, is that we have recovered from 2020 and are on a positive trajectory. With all the hurdles and stressors we have endured the past couple of years we have an optimistic outlook for 2022. There is light at the end of the tunnel, but it may be more distant than we hope for.
The issue we face is the demand for steel remains at a pace greater than production can achieve. Several factors continue to be at play; COVID-19 infections and logistical mazes wreak havoc when trying to overcome shortages.
With limited inventory and rising demands, EspriGas is seeing a sharp increase in gas cylinder sales with customers to better prepare for the upcoming busy season. While supplies are available currently, we are uncertain if stock levels will be adequate should the volume exceed our forecasts. It is advisable that orders be placed sooner than in years past to assure timely shipments.
In addition to the increasing demand, backlogged steel orders remain prevalent. Manufacturing is at max capacity, and the impact is yet to be felt. Additional increases in pricing are helping with production and new mills are coming online. We anticipate the cost of steel to stabilize as the steel market continues to recover.
This year will be better than last, but we are not out of the woods yet. The industry will continue to be optimistic. Demand will be high and we will not see a plateau until 2023 from the looks of it.
Article Reference: 2022 Steel Outlook: Growing Demand & Higher Prices. Link: https://www.fedsteel.com/our-blog/2022-steel-outlook-growing-demand-higher-prices