Steel Mills, Service Centers, Roller/Benders, Fabricators and Erectors in the Construction Supply Chain


The supply chain for structural steel construction begins with the producers of steel:  steel mills.  What was once thought of as a dirty, inefficient business has now received awards from the Environmental Protection Agency for best industry performance.

According to the American Institute of Steel Construction (AISC), in 1980, it took 12 man-hours to produce a ton of steel.  In 2009, it took only 0.5 man-hours to produce a ton.  The steel has 40% higher strength, is produced with 1/3 of the energy, and has a 38% reduction in carbon emissions and a 67% reduction in overall emissions.

modern day steel mill
Modern Day Steel Mill

Structural steel fabricators buy 70% of their steel from steel service centers and 30% directly from steel mills.  Steel mills have minimum load and item requirements which may exceed what the fabricator requires for a given project.  Consequently, the fabricators turn to service centers who replenish their inventories with the larger mill purchases.  Steel mills also have rolling schedules so a fabricator may have to wait weeks to obtain material that could be shipped overnight from a service center.  Of course, the benefits from using a mill can include special lengths and lower cost.

If the project involves curving structural steel, a Bender/Roller can either supply the material or have the fabricator buy it.  If the Bender/Roller supplies the material, it has the same options regarding the mill vs. service center decision.

According to AISC, 20% to 40% of the steel package is the cost of material; 60% to 80% of the steel package is in the fabricator’s contract.  In addition to fabrication, the fabricator develops detailed piece drawings and purchases fasteners, deck, joists and other components.  The fabricator supplies optional services such as bending and rolling, galvanizing, and fire protection as well as paintings and coating.

The fabricated steel sections are then shipped to the jobsite where an erector constructs the building.  Just as the steel mills have streamlined their operations, so too today’s steel construction supply chain produces valuable, secure and sustainable buildings for our communities.

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