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Aluminum price roller coaster continues

After skyrocketing 30 percent from January to May, aluminum prices have made an about face. The first several weeks of June saw prices slide about 15 percent from May’s highs.

The rise and fall of prices creates challenges for contract glaziers attempting to set bid prices for building owners, says John D’Amario director of sales for Architectural Glass & Aluminum Co. in Oakland, Calif.

“Aluminum is going down, but you can’t just adjust as contract glaziers,” D’Amario says. “You have to pick one level of pricing and stay consistent. If you followed prices up and down because that week it looked like they were going in that direction, it’s eventually going to cost you.”

The challenge for glaziers stems in large part from the lag between bid and sale closing, allowing time for aluminum prices to change drastically, D’Amario says. “We’d never be able to buy aluminum at [the original] price by the time that sale closes,” he says.

Architectural Glass & Aluminum buys some aluminum direct, allowing the company to enjoy the recent round of lower prices, he says. However, the lower prices from manufacturers just match higher prices from fabricators that have recently instituted price hikes to account for high costs in May.

Fabricators such as Vistawall Group of Terrell, Texas, and Kawneer of Norcross, Ga., responded to May’s high prices by passing price hikes to their customers. Both companies implemented a 6 percent increase, effective May 30 for Vistawall and June 26 for Kawneer, according to price letters sent to customers.

D’Amario doesn’t expect to see price letters coming in reflecting June’s lower prices. Rather, he predicts that prices will shoot up again as quickly as they fell.

D’Amario’s prediction echoes that of executives from Pittsburgh’s Alcoa Inc. Officials from the company spoke to investors June 15, forecasting that the growing demand for aluminum in countries such as China will reverse the recent price slide.

 

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