After working in the banking industry for 5 years after college, Courtney realized she needed a change and decided to pursue a new career path. Growing up she has always been creative and enjoyed writing, taking pictures, or painting. Now as the Marketing Content Creator for FBi Buildings, she gets to utilize her creative abilities in her everyday work. In her free time, you can find Courtney at home reading a book, partaking in any and all outdoor activities, or traveling and photographing her adventures. Courtney resides in Northwest Indiana with Lacey, her red tick coonhound.
Over the last few months, we have seen quite a few changes that have arisen amid the effects of COVID-19. We see these changes happening in our daily routines, business operations, and the economy.
Here at FBi Buildings, we have seen some changes in the post frame industry as well.
When the stay-at-home order was put into place earlier this year, certain aspects of the post frame industry chose to dial back production for the foreseeable future until they had a certainty of what the future would hold.
These aspects we’re talking about are the lumber and steel industries.
We saw quite a decrease in lumber and steel commodity prices, which was the most significant decrease the post frame industry had ever seen. Despite contractor's efforts who were trying to push new projects through the pipeline, a decline in construction was inevitable given the circumstances brought on by the coronavirus.
Prices dropped to accommodate for the lack of production, or in some cases, no production at all, so within the last few months, it’s been extremely beneficial to begin a new post frame project for those who had plans to build in 2020.
The post frame industry has still been seeing quite a lot of demand, and it’s no surprise that customers have wanted to take advantage of the economic benefits. However, these low prices will not be around forever, and the industry is starting to notice that.
Since stay-at-home orders are being lifted and the economy is starting to open back up, the lumber and steel industries have started production again. With the demand for construction coming in while the weather warms up, prices are rising again to meet the demand.
What does this mean for those who are looking to build in 2020?
We’ll answer that question in this blog and talk about the uptick in commodity pricing. Keep reading to learn why now is the time to get your project rolling.
How is COVID-19 Affecting the Post Frame Industry Today?
Even with the challenges and uncertainty brought upon by the coronavirus, the post frame industry is still in high demand. Since construction is deemed an essential job, and permit offices are open, our crews are able to continue building. Projects that were already in the process of being constructed could continue, and new pole barn projects could begin.
Our number one priority during this pandemic has always been, and always will be, the health and safety of our customers and our employees. We took the regulations of the centers for disease control (CDC) to heart by opting for crew sizes under 10, ensuring proper sanitation methods, and practicing social distancing guidelines at all times.
For our customers who did not feel comfortable meeting with our Project Sales Consultants (PSC) in person, we advocated for doing things virtually. The free consultation could be done by phone to promote health and safety and eliminate any delays in getting a project started.
On top of this, the post frame industry saw a serious decline in lumber and steel commodity pricing. This brings us to 3 economic benefits for building in 2020, and why now is the perfect time to build if this is in the cards for you.
Continue reading to see how the 3 economic benefits are adjusting as the economy begins to open back up.
What are the 3 Economic Benefits of Building a Pole Barn in 2020?
Even though lumber and steel commodity prices are on the rise again, now is still an excellent time for post frame construction to begin on your new pole barn, granted this is a part of your plan this year. Prices are still much lower than usual, so it’s a good idea to take advantage of this while you still can.
Even though contractors were doing their best to continually move new projects through the pipeline, the construction industry was seeing a decline amid the coronavirus (COVID-19) outbreak.
Lumber prices reflected this industry decline and dropped to an all-time low.
To regain control of plummeting prices with regards to what the future holds, major sawmills had to dial back on the production of building materials to accommodate the decline in demand.
In other instances, some wood producers opted to completely shut down for the foreseeable future until they had a certainty of what the future would hold for them.
Now, as states are lifting their social distancing guidelines stage by stage, sawmills are beginning to re-open and begin production once again. Since summer is just around the corner and the weather is warming up quickly, construction projects will once again be in high demand.
Future projections are currently showing that lumber prices are beginning to rebound.
2. Rising Steel Prices in the Coming Months
Our next benefit goes along with lumber prices, as a second major benefit to building in 2020.
Another industry in the construction world that was facing severe pressure amidst the viral pandemic is metal, and more specifically, steel.
As we saw with the lumber industry, steel mills also dialed back or completely halted the production of steel. They decreased capacity utilization rates, and U.S. steel prices dropped in response to key buyers suspending their building operations.
Again, as states are starting to lift their social distancing guidelines stage by stage, steel mills are resuming production once again.
With the demand for construction projects starting to come in for the summer months, steel prices are beginning to trend upward as well.
3. Lower Government Interest Rates
Lastly, our third benefit of building this year is the incredibly low interest rates on loans that we are currently seeing.
Unsurprisingly, global financial conditions were adversely affected because of COVID-19.
In lieu of these circumstances, the Federal Open Market Committee lowered the federal funds rate to 0 to 0.25 percent. These interest rates are the lowest we have seen to date in hopes to help stimulate the economy during the coronavirus uncertainty.
Furthermore, the Committee will continue to maintain this low rate range until they are entirely confident that the U.S. economy has weathered the aftermath of COVID-19.
Should you choose to finance your pole barn, by opting to obtain a loan for your post frame project, you are able to take advantage of these unbelievably low rates. If your loan allows for a fixed-rate, that’s even better, because now you can lock in this low rate for the entirety of your loan term, or at least for a portion of the loan term, depending on what the loan agreement states.
Do You Plan to Take Advantage of These 3 Benefits While They Last?
As we mentioned earlier, these low prices and low interest rates are not going to last forever, although we really wish they could. If building a new pole barn is in the cards for you this year, now is the time to take advantage of these prices before they increase to where they were before coronavirus hit.
As one of the top post frame builders in the Midwest, we want to do our best to inform you of market trends so that you can get the most out of your post frame building. With over 60 years of industry experience, we are confident that this is the perfect time to build your dream pole barn.
When you’re ready to build, give your PSC a call for a free consultation and site prep planning without ever meeting in person. We’re here to safely help you through the beginning stages of building your new pole barn and answer any questions you might have.
As always, we care about your health and safety, and we will do whatever we can to not jeopardize either. We hope you all stay safe, stay healthy, and always remember to build with confidence.
Do you have more questions about rising pole barn commodity prices that are not covered in this article? If you need help designing and planning, please contact FBi Buildings at 800.552.2981 or click here to email us. If you're ready to get a price, click here to request a quote, and a member of our Customer Engagement Team will help you determine the next steps of your project.