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Steel shortage could cause equipment costs to soar

Municipal equipment manufacturers are being badly hit by the high price of steel, the European Municipal Equipment Manufacturers Association (VDMA) has warned.

And it has cautioned that manufacturers may have to increase prices to compensate.

The VDMA believed that the raw material market was in the midst of a crisis with the emergence of Chinas manufacturing centre catching out the world suppliers of steel.

Steel is a key material for equipment manufacturers, it said, and from a technical point of view, there is no alternative. A reliable market supply and a calculable price development were also essential to meet demands for mechanical engineering products with stable prices ready by fixed deadlines.

Unfortunately, neither of these criteria are being met, it stated.

Steel prices have risen by up to 50% in the last six months and there is no end to this upward spiral in sight.

It stated that the only alternative would be to turn down contracts or to pass on part of the cost to the customer.

The only scope left to manufacturers for compensating for the increases in steel prices is via higher prices for machinery. We can expect prices in the municipal equipment industry to increase, it added. u

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