Looking for observations from across the country.

[JackTerp]

I had a discussion with my local co-op about the pricing of fertilizer. He has always told me that the cost was so high because of the price of oil. Now that the oil is the lowest in a decade, I inquired why the cost of fert has not come down significantly. Has anyone found cost of goods to be any lower today than they were a year ago? I haven't, except for steel from a local supplier. It seems, to me at least, that companies are now racking up enormous profits by not passing along their lower costs for raw materials and transportation.

 

[wiscwhip]

I would agree with the cost of steel being down. I do structural steel estimating and the price of steel has dropped about 35%-40% over the last 6 months to a year. On some of the jobs that are a year out or more, we are apprehensive about giving those super low prices in our bids(even though we still do) because the price could jump right back up any time between now and when the steel needs to be purchased for fabrication in 9+ months. Everything else, not so much, costs are still the same or even increasing.

 

[JackTerp]

I would agree with the cost of steel being down. I do structural steel estimating and the price of steel has dropped about 35%-40% over the last 6 months to a year. On some of the jobs that are a year out or more, we are apprehensive about giving those super low prices in our bids(even though we still do) because the price could jump right back up any time between now and when the steel needs to be purchased for fabrication in 9+ months. Everything else, not so much, costs are still the same or even increasing.

I understand that trying to make decisions months in advance are nearly impossible in todays markets. My son is a long haul truck driver and he has noticed that even his company is not making any changes in mileage charges to customers. This is even with the cost of fuel dropping very low. I have not noticed any similar drops in any of the consumer products that I normally buy though. I buy steel for projects for my fabricating hobby. The cost of steel has dropped dramatically lately, but that is the only items I have found or noticed. Fertilizer is still at a high cost. Ordering seeds, I have found nobody dropping their shipping charges. In some cases the cost of shipping is greater than the cost of the seed. It seems, to me at least, that someone has got to be reaping the profits and not passing along these savings along to the customers.

 

[Turkey Creek]

That is how life works! Prices are fast to go up, slow to come down. I would venture a guess that most of the fertilizer was produced before the drop in oil prices though.

 

[Bowsnbucks]

Jack - Reaping profits ??? Not passing on savings to customers ??? COME ON ......... IT COULDN'T BE !!! :rolleyes:
I wonder if the fertilizer is made far enough in advance that they have it stock-piled and the price of oil was still high when it was made ?? I don't know how that model works, and I'm not defending greed by any means. Anybody know ??
I can only speak for myself, but when I do an electrical job for someone, I try to pass on any savings I can and give them a reasonable price. Maybe that's why I get repeat business and recommendations by word of mouth ?? I don't have it in me to screw folks. Old-fashioned up-bringing I guess.

I just saw TC posted right ahead of me !! ^^^^ He's thinking the same way.

 

[Jameson]

Not so sure how much the price of steel is a good measure. The price paid for metal scrap is also way down. I have been told that is because of an end to a huge housing boom in China. The demand has dropped considerably and now so have the prices.

Gas prices may have gone down, but health care prices continue to rise.