Steel price index

A steel price index reflects the current price level of a specific portfolio of steel products. Various institutions publish such indices.

What they all have in common is that they can only reflect the current price level. They do not allow any conclusions to be drawn about future changes.

A steel price index allows prices to be indexed on long-term projects. With price adjustment clauses, contracting parties can protect themselves against rising prices. In recent months, there have repeatedly been very short-term price changes. A steel price index cannot reflect such fluctuations.

Steel price index of the Federal Statistical Office (Germany)

The steel price index of the German Federal Statistical Office is compiled in a similar way. It also contains detailed information on various product categories. Here you will find a particularly clear presentation of the steel price index.

Statistik Austria wholesale price index for iron and steel

Statistik Austria determines current wholesale prices at monthly intervals and uses them to compile a wholesale price index for iron and steel. The basis is around 1,400 wholesale prices, which are provided voluntarily by around 220 wholesale companies.

In addition, Statistik Austria also compiles a detailed index in which different product types such as sheets, sections or reinforcing steel are listed separately.

In Austria, the wholesale price index for iron and steel is applied within the framework of Önorm B2111 “Conversion of variable prices for construction work”. Önorm B2111 contains detailed information on calculating variable prices in construction. To make conversion easier, the Austrian Federal Economic Chamber (Wirtschaftskammer Österreich) also provides a conversion tool at https://www.preisumrechnung.at/.

Steel price index of the Federal Statistical Office (Switzerland)

The Swiss Federal Statistical Office also publishes a steel price index in a similar way.

Other steel price indices

In addition to the indices of the respective national statistical offices, there are also “private” steel price indices. These are published by some steel traders or steel processors and relate primarily to their own product portfolio.

Stahl Kompakt steel price index

The Stahl Kompakt steel price index evaluates more than 100 individual steel grades. The prices come from steelworks, evaluations of internal projects, general economic data and expert assessments.

Ambros Schmelzer steel price index

No sources are given for this index. Prices are shown in €/tonne. They suggest that these are average purchase prices for structural steel from German steel traders. Link to the website.

The steel price index of ELF Hallen und Maschinenbau

This index shows the average purchase price of the most important steel grades used by this company. Link to the website.

Frank Stahl steel price index

Frank Stahl shows a publicly accessible index on its website. The data comes from Statistik Austria. Instead of absolute prices, the prices are indexed to a reference value, with the value 100 representing the 2020 annual average. In addition to average prices, values for individual sections, sheets or different materials are also shown.

With indices from steel processors and steel traders, bear in mind that they only reflect the situation of the company concerned. This does not necessarily mean that other companies pay the same prices. There are also regional differences. Some of our steel construction suppliers buy steel abroad at considerably lower prices.

Steel price index or exchange prices – which is more meaningful?

Commodity exchanges are a daily source of information on steel price trends. The London Metal Exchange (LME) is the world's most important commodity exchange for industrial metals. The following steel products are traded on the LME:

• LME Steel Scrap (scrap, several countries)
• LME Steel Rebar (reinforcing steel, several countries)
• LME Steel HRC FOB China (China hot-rolled coil)
• LME Steel HRC N. America Platts (US hot-rolled coil)
• LME Steel HRC NW Europe Argus (EU hot-rolled coil)

A serious disadvantage of these indices is that they only apply to these product groups with high trading volumes. While they do reflect the general trend, they do not respond to price changes in other product groups. If, for example, there is a shortage of steel beams, the cost increase will not show up in the index. You should also bear in mind that hot-rolled strip in large quantities is considerably cheaper than steel beams or plate from steel stockholders.

The big advantage of the commodity exchange is that it provides up-to-date daily prices in absolute figures (USD per tonne), whereas the indices lag behind and only ever give a reference value. Another aspect is that trading in futures contracts makes it somewhat easier to interpret the future market situation. While you cannot read off the future steel price, you can at least gauge volatility and speculation.

About the author