Material Impacts June 2010 "Holding Steady"
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Executive
Summary
Quick
Summary: The prices of all raw materials that we track rose as follows over the
pastMaterials Chart  |
year:
Aluminum:
Up 48% from May 2009.
Brass:
Up 49% from May 2009.
Copper:
Up 49% from May 2009.
Nickel:
Up 108% from May 2009.
Stainless:
Up 75% from May 2009.
Steel,
Busheling: Up 125% from May 2009.
China
Coke, Up 13% from May 2009.
They may not call it inflation-
YET. But all of the crucial raw materials we track are up double and triple digit
percentages. In addition to the fundamentals in our local markets, the rare global issues
that add more risk and thus price variability to our industry's raw materials.The issue of knowing
where to find material remains just as important as price in the current market.
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Producer Price Index
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What is the PPI?
· The Producer Price Index published by the Bureau of Labor Statistics tracks the average change in prices over time of domestically produced and consumed commodities. BLS reports monthly. It doesn't measure actual
price, it measures an index that tells us what direction prices are headed. In
most cases 1982 = 100
· GNA marketing extracts some of this data.
- We and our customers need to be aware of the price movements of competing materials such as wood, concrete, asphalt, hollow structural shapes, plastics, castings etc. If significant trends develop we should factor this into our forecasts. For example current trends with concrete and steel are good for rebar but bad for structural steel.
- We need to track the cost escalation of structures and highways as this will affect future business. This is particularly true of State and Locally financed projects that have strict budget authorizations.
- The PPI of commodities affects the energy and mining industries which in turn drives demand for many of our products.
· As far as we can tell, this data is extremely accurate as shown in the two reality check graphs.
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| Success! |
Brass Insert  | Here's what our customers are saying!
"Avanti has been an excellent supplier to us for many years. They
consistently provide us with a quality product at a competitive price
and our mutually beneficial business relationship is expected to remain
in place for many years to come." "As a fairly new purchaser, I have found the Avanti team very
friendly , easy to work with and very customer oriented. They are
willing to take the extra steps to meet our requirements."
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As always thank you for your business and your interest
in Avanti Engineering, Inc. and for taking the time to stay in touch
with us by reading this newsletter. If you have any suggestions for
improving our newsletter by including additional specific information
please let me know. Thanks again!
Best Regards,
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