Metal Wholesaling in the US Industry Market Research Report Now Available from IBISWorld

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Because metal wholesalers and service centers supply metal products to just about every manufacturing industry and construction market, the Metal Wholesaling industry represents one of the largest industries in the United States. In 2012, the manufacturing sector recovered strongly from the economic downturn, while residential and commercial construction projects have experienced ongoing weaknesses. For these reasons, industry research firm IBISWorld has updated its report on the Metal Wholesaling industry.

IBISWorld Market Research

IBISWorld Market Research

Rising demand and prices will benefit industry profit as wholesalers pass down costs

The Metal Wholesaling industry is one of the largest industries in the United States. Metal wholesalers and service centers supply metal products to almost every manufacturing industry and construction market. None of its downstream industries escaped the recession unscathed, with construction taking the biggest hit. Since 2007, metal wholesaling revenue has declined at an average annual rate of 2.1%. In 2010 and 2011, the manufacturing sector recovered strongly from the downturn, though residential and commercial construction projects experienced ongoing weaknesses. Demand for metal products has continued increasing during 2012, with estimated revenue growth of 6.3%. The industry's revenue is expected to total $204.2 billion in 2012.

In combination with supply trends, demand from downstream industries and international markets guide the price of metals sold by the Metal Wholesaling industry, says IBISWorld industry analyst Antonio Danova. Steel products account for a majority of industry revenue; therefore, the price of steel determines the fortunes of many industry players. Steel prices rose dramatically through 2008, declined sharply in 2009 and rebounded in 2010 and 2011, alongside rising consumer spending and automobile purchases. In 2012, the prices for steel and other metal commodities remain high on the back of strong international consumption of metal-based products. Over the five years to 2012, the price of steel is estimated to increase at an average annual rate of 2.6% to a producer price index of 218.6. This year, rising demand and prices have benefited industry profit, as wholesalers have been better able to pass down inventory costs. Despite recent revenue growth, sales have increasingly been concentrated among a smaller number of players. Over the five years to 2012, the number of enterprises is projected to fall at an average annual rate of 1.8% to 6,398 firms employing roughly 148,856 people. Many of the larger companies have acquired struggling smaller firms to expand their market share, increase revenue and reduce exposure to more localized demand swings, says Danova. Consolidation is a significant industry trend and is forecast to continue through 2017. Over the five years to 2017, industry revenue is anticipated to increase. Sustained growth will come from stronger domestic demand conditions, increased US construction and projected moderate rises in metal prices that will benefit industry revenue and profit. The top firms in the Metal Wholesaling industry include the Reliance Steel & Aluminum Co. and Ryerson Inc. Revenue in this industry is spread across a large number of relatively small industry players. The majority of firms operate with less than 20 employees.

The main cause for this low level of concentration is the need for businesses to be close to customer markets. For most metal wholesaling establishments, the majority of customers are located within a 200-mile radius. As a result, the metal distribution business remains highly fragmented, with the vast majority of service centers offering value-added processing and rapid delivery to customers in a wide range of product niches.Consolidation has been high in the past decade, with the level of concentration within the industry rising. Larger companies such as Reliance have made numerous acquisitions in the last 10 years. Consolidation has also occurred among smaller players, as local operators merge in an effort to withstand turbulent economic conditions. For more information, visit IBISWorld’s Metal Wholesaling in the US industry report page.

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IBISWorld industry Report Key Topics

Companies in this industry primarily engage in the wholesaling of metal products. Service centers maintain inventory and may perform functions, such as sawing, shearing, bending, leveling, cleaning or edging. Services provided by the Metal Wholesaling industry include cutting-to-length, slitting, shearing, roll forming, shape correction and surface improvement, blanking, tempering, plate burning and stamping.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit or call 1-800-330-3772.

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Gavin Smith