SJF's Material Handling Blog
Should you cut your prices to increase sales during a recession?
Let’s Check the Math
FACT: If you cut prices by 20%, you have to sell 25% more units just to maintain revenue(break even).
During good times, a 25% increase in sales volume is asking a lot. In a recession, the math says it’s self induced suicide for almost all who try.
The US government slapped preliminary anti-dumping duties on imports of more than 300 million dollars worth of wire decking from China, the Commerce Department said in a statement on Tuesday.
The department claimed that it found dumping of wire decking from China after investigation. The tariffs of between 42.61 to 289 percent will be imposed and collected until a final determination is made in the case.
Wire decking reinforced with structural supports is designed generally for industrial and other commercial storage rack systems.
The United States has imposed duties on a variety of Chinese goods including steel pipes, grating and tubular goods based on other investigations.
The wire decking anti-dumping case is another move that might escalate trade disputes between the two major trade players in the world.
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Sources: US scrap prices will continue rising
The US scrap market for January and February is still taking shape – but market players tell Steel Business Briefing they expect prices to continue their upward march.
“I think the demand is going to be exceeding the supply, so I think prices will remain strong,” said one West Coast market player who said shredded scrap for export to Asia was selling at around $300/long ton, fob.
Turkish steel mills are still buying little scrap because of the high global prices. US suppliers are not offering any price to Turkey because of the strong domestic demand in USA, market sources tell Steel Business Briefing.
Only one deep sea cargo from the European Union was sold to Turkey this week. This latest mixed cargo included 5,000 tonnes of busheling scrap, 5,000 tonnes of shredded and 35,000 tonnes of HMS 1&2 70:30 sold at $314/t cfr, SBB learns.
We have just completed a new animation demonstrating the operation of a VLM (Vertical Lift Module). This animation shows how a VLM uses trays to store items of different sizes in an upright enclosed space, similar to a vertical carousel.
A higher than expected jump in US scrap prices has some in the scrap market feeling skittish about volatile prices, Steel Business Briefing notes.
“The numbers have gotten out of control,” said one Midwestern US scrap buyer, while predicting the market would go up again in January. “There will be no way that mills can pass along that kind of a steel increase to their customers…therefore it will create a margin squeeze on the mills, which isn’t good for anyone.”
Courtesy: Steel Business Briefing
US scrap prices could head up next month by $20-30/long ton, followed by another similar price increase in January, market sources tell Steel Business Briefing. Shredded is currently selling for about $240- 255/l.t on the domestic market.
“We are hearing that a rise in the market is expected in December, and up more in January. We hope they are correct of course,” said one southern US scrap dealer, adding that he expects a $20-30/l.t increase each month.
Source: Steel Business Briefing