U-Channel Sign Post Supply Shortage

U-Channel Sign Post Supply Shortage

               It’s no surprise these days to see pricing of goods doubled and shelves empty. In fact, it’s almost expected now that goods cost more each month than the previous month. It’s affected everything from the automotive industry to the grocery stores. One industry that has been impacted by this on a significant scale is the steel industry. Here at Traffic Safety, we can attest to this, as our cost of steel u-channel sign posts has increased drastically, not to mention the delays in shipping and manufacturing and the overall supply issue.



        As with many other industries, Covid-19 was the catalyst that sent the industry off-balance and into disarray. Factories began to lower their production capacity or paused production all together in the early stages of the pandemic in 2020. That shut down created a whole host of other issues that the steel industry, and many others, have yet to figure out.

        Upon returning to work, factories and businesses across the globe have been plagued by a lack of workers. Specifically, a lack of skilled workers to operate the machinery needed to run production efficiently. This lack of manpower has resulted in lower outputs for steel factories which is only emphasized by a higher demand for steel. A sudden surge in demand for steel caught the mills off guard. Homeowners and businesses alike used this time to focus on home and office improvement projects. Corporations returned from lockdowns with the goal of rebounding from the loss and have been ordering at larger quantities as well. This instantaneous rise in demand combined with mills operating at a reduced production rate has led to the shortage and price hikes we see today.



        With demand at an all-time high and production at a significantly reduced output rate, steel reserves have long since been bled dry. The ports are overwhelmed and containers with raw materials sit idle, waiting for transport. A shortage of truck drivers, shipping delays and the incredible rise in the price of gas are all factors that add in to the rising cost to maintain steel. From March of 2020 until now, the cost of steel has risen over 300%. The United States government has an index that tracks the costs of a wide variety of goods and services sold in America as well as globally. Their research indicates that this is the largest spike in the cost of metal since the Great Depression. Steel prices have seen an increase in cost the last 14 months straight, with 10 of those months having supply at an extreme shortage.

steel pricing


                The cost increases don’t stop there though. Consider all the other components and products that have steel in part of their design, or require steel and machines to produce. Commodities and consumer goods have been plagued with delays in raw materials and their ever-increasing costs. For example, the price of household appliances rose nearly 7% in the last year which is the highest increase in over a decade. The cost of steel u-channel sign posts here has skyrocketed as well. Analyzing the cost of goods just before the pandemic until now, we’ve found that our cost in green u-channel sign posts has, at every size offered, risen an average of 19.25%. This is only dwarfed by the rise in cost of our galvanized u-channel sign posts which have, as a whole, seen an average increase of 27.3%. Price hikes to this degree, and a lack of availability, is stretching the industry thin.



        While there is no one-size-fits-all band-aid for this, there are proactive actions that can be taken to try and eliminate potential additional costs and material shortages:

  1. Budget for Projects Months in Advance – Take a look at what projects you know will be coming down the pipeline. The longer you’re able to set aside funds for the cost of future projects and raw materials, the better off you’ll be when the time comes.

  2. Buy in Bulk – With materials and sign posts being in high demand with low supply, it would be a great idea to purchase what you think you’ll need a few months in advance. This will help lower the cost of the individual unit as well as ensure you have your supply to complete jobs instead of having to wait for a resupply of posts or other products.

        Currently, our lead time for another truck load of posts is months away. Planning in advance will allow you to complete your jobs on time so that you can get paid for your work earlier. Buying while posts are still in stock will also save you on additional costs and fees that might be accumulated if individual rush post orders need to be placed to satisfy project deadlines and goals. It’s still unsure how long it’s going to take for the steel industry and others to catch back up with demand. Planning ahead would save you valuable time and money!

Contact us today at Traffic Safety Direct to discuss all the ways we can assist with project forecasting and material needs!

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