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How To Shop for Tray Cable And Why Copper Pricing Affects The Ultimate Price You Pay

Most people following the markets lately have noticed that commodity costs have been increasing steadily through the first half of the year. As vntc cable as well as tray cable, type g, soow cable, and welding cable are all heavily dependent on raw material costs, there has been a noticeable increase in the cost associated with these items.

Most of our regular customers are acutely aware of the effects of rising raw material costs. Most important of course is the price of copper. Today for instance copper was selling for about $4.30 lb at the COMEX. At this price point it is just off its all time contract high of around $4.60 per pound hit just a few weeks ago at the beginning of 2011. The question on everyone's mind is how much higher can it go.

A close second to copper in electronic cable manufacturing is the price of oil. As the jacket and insulating material of most cables are petroleum based, the price of oil plays a big role in pricing also. Oil we know hit a high of about $147 per barrel just 2 1/2 short years ago and right now is on the rise again primarily due to tensions in the Middle East and North Africa. Oil is currently going for about $104 per barrel.

Assuming the economy keeps improving, it is quite likely that we will experience a continued rise in these raw input costs. The majority of economists agree that we are in the midst of a slow but steady recovery that will go on for the rest of 2011 and beyond.

Many emerging markets are also seeing improvements with China of course being the largest in terms of increased GDP. If we can continue with this current track it is reasonable to believe that copper and oil will continue to appreciate in price. If you are a heavy user of the larger types of wire and cable it may behoove you to take a look at some projections for later this year and maybe consider stocking up now before we start to see the large cost increases.

So how can you use this knowledge to your advantage? When you see prices decline on the NYMEX, ensure that your supplier is reducing the costs of their finished products to you. Often, companies are more apt to increase prices than to lower them. Now knowing what raw materials cost, make sure that your supplier is passing some of the savings along to you where appropriate.

When you see there is a disparity in the cost of the raw materials and your finished product price, consider contacting another supplier for a competitive bid. There are many distributors who sell tray cable and vntc cable. This extra effort on your part may help you keep more profit for yourself. Additionally, knowledge of cost reductions can allow you to lower your bid prices, which may make your bid a bit better than your peers – and allow you to win more business.

If you have any concerns or are in need of more detailed advice, please feel free to contact us. Delco Wire has been in the wire and cable business for over 30 years. Our very experienced staff will be more than happy to help in any way we can. We can be reached toll free at 800-714-9473.

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