June 2010 – Steel’s sustainable success story
Amid all the headlines about rising raw material costs worldwide pushing up the price of steel it is worth considering that even with those pressures the cost of the frame and floor of a steel-framed building is still well below 2008 levels. The recent rises constitute less than 1% of overall building costs; not an inconsiderable sum, but one that should be viewed in a proper perspective.
Clients of the industry who have managed to fund developments despite the credit crunch and its fallout have been able to take advantage of some of the best prices for years, and the return on their investments will be accordingly greater. Even before the recent price increases the steel construction sector had been sending out strong messages that now is the time to act to capture the lower prices.
With a new government in place determined to cut the public sector deficit overall construction demand looks unlikely to pick up appreciably in the short term; but hopes remain high that private sector investment in a growing economy can pick up at least some of the slack. In such a cost conscious environment the many financial and other efficiency advantages of steel construction should come more to the fore.
Steel looks like continuing to be the framing material of choice for key sectors whatever the precise shape of the market in the foreseeable future, a view that is borne out by the most recent Market Share Survey by independent researchers Construction Markets (see News). The survey shows that steel is still market leader in non-residential multi-storey buildings by a large margin, being selected as a framing material well over three times as much as the nearest rival, insitu concrete. Steel has even managed to increase its share of the key single storey industrial buildings market to over 97%.
The remarkable success story of structural steel over 25 years or so has proven to be just as remarkably sustainable, having now been tested by several recessions and the booms that went with them. Throughout this period the steel construction sector has made major strategic investments in productivity boosting technology, and shared the benefits with its customers. Investment continued despite the recession, as is seen in recently launched design guides for Eurocodes and in the Target Zero guides for low and zero carbon buildings.
Whenever worldwide pressures force rises in steel prices, which similarly affect reinforcing bars for concrete construction, the relative competitive position remains unaltered and steel invariably wins over new supporters amongst cost conscious and sustainability minded construction teams. Overall cost and sustainability benefits would be expected to protect steel’s market position on their own, but factoring in the other advantages like inherently superior health and safety, as reported in the May issue of NSC, and speed, steel construction is looking forward to improving markets with confidence.