We can talk to our dealers and growers. And so the confidence is just starting to build. And so that’s why we’ve talked about the quarter kind of being the way it is. Avner, do you want to add in to kind of the way we’re thinking about it?Avner Applbaum Yes. So, when we kind of look at — thank you, Steve. So, when you look at the actual quarters, we’re kind of looking sequentially and really looking at kind of the North America volumes being pretty much flat Q1 — Q2 to Q1, similar kind of sequential pricing as well. And then we do see the impact of the international markets kind of sequentially being 10% up, driven by kind of the comps year-over-year.Nathan Jones Okay. I know you guys have talked about — and obviously, [Indiscernible] steel has gone up very rapidly again and you’ve talked about having needing to raise prices to cover those increased costs.
Are farmers continuing to be able to bear those cost increases? Is that kind of having any impact on their outlook for irrigation spending? There’s still a drought moving across the Midwest, how does that impact farmers need to go out buy irrigation? Just any more color you can give us around that.Steve Kaniewski Yes, I’d say, Nathan, this is probably — the price increase we’re talking about now is probably our smallest price increase that we’ve gone out with over the last couple of years. It really is just to take some of the edge off as it pertains to steel, some of the labor inflation and some of the other freight and oil and some other things like that.So, it’s really just to kind of put it back to what I would say is a normal price increase representative of the market and our continued investment in technology that we’re supporting.The pivot still has an incredible payback.
And as you mentioned, some of the conditions that are out there, the need to get data off the field, to conserve water and to really ensure that there’s a crop and particularly the large-scale farms, as we’ve mentioned before, if they have the rights, they’re going to put a pivot in almost immediately.So, we don’t think that this is going to push the market to any kind of elasticity problem. And we’re just really getting ourselves back to a price cost ratio that we believe is indicative of where we would have been even back in, let’s say, 2013 or 2014.Nathan Jones Great. Thanks very much for taking my questions.Operator Thank you. Our next question comes from the line of Brian Drab with William Blair. Please proceed with your question.Brian Drab Good morning.
Maybe I could just start by building on that last question around steel prices and just ask it more broadly. I mean, steel has just been on a roller coaster ride. And from last summer until where we are today, I mean it’s gone down dramatically and then it’s up like 80% year-to-date.So, what are you seeing in terms of the price change in your different segments over that time period, kind of if you look at this latest big dip in steel price from last summer to now, like where are we?And then also, how is that maybe that big swing — recent swing affected businesses like irrigation? There was some thought that maybe some customers might be — have been waiting for a price decrease and that paused the market somewhat. I don’t know if that comment on — is that dynamic real?
And did you see that?Steve Kaniewski Yes. Thanks Brian. Our steel price and irrigation as a percentage of the cost of goods sold is not as significant as it would be in the utility business. That said, it uses more of the coil, which has been more volatile than the other forms of steel, which we use like plate and bar and angle. And so it can have a more dramatic impact to your cost to get sold in a quicker time period.We’ve done a good job of protecting our customers and ourselves through hedging programs, through some physical hedging as well as some inventory management programs that we’ve kicked in place. And so it was really tough for a while to kind of figure out where steel was from the price/cost perspective.And that’s why I think we’ve seen it enough stability even with the movements down and up, where this can be just a nominal tweak, so to speak, to the pricing that we need to make sure we’re capturing what we are.Recall that in particular our utility business, we have pass-throughs.
And so in the second half of the year, we know that some of our revenue and utility will go down, not the margin, but the revenue because we give that back through the form of steel pricing.Now, that uptick with a 40-week lead-time won’t show up until next year in terms of some revenue increases that will then come through the mechanisms. Plate steel has been pretty resilient through all of this, and that’s because a lot of plate goes into infrastructure. And infrastructure, whether it’s bridges in highway or like our own utility business, has remained pretty strong.And so the dichotomy of coil to plate is still there, albeit not as significant as it was during the peak, but that normalized kind of $100 a ton difference is not something we’ve seen for a long time.So, long-winded answer, but I would say to you that steel and the recent movement, we’ve accounted for well and I think we’ve done a good job of being able to protect both ourselves and the customers and really has not dampened demand.Yes, there are some people that wait on the sidelines that always happens.
But I think in today’s inflationary environment, there’s other points of inflation that really no one should be expecting a price decrease anytime soon or anything that’s got steel or aluminum or zinc or metals involved with it.Brian Drab Great. Yes. Thanks. That’s really helpful. And then can you, Steve, just comment on any big international projects that might be out there, just that dynamic? Is the pipeline still as strong as it’s been?In the past, you mentioned that even in Egypt, you’re seeing the potential for maybe some add-on projects there. I know you announced some like $85 million in opportunity in Africa. Can you just comment on that pipeline?Steve Kaniewski Yes, I’d say that the pipeline over the last couple of years has been that there’s one very significant order per year like the $85 million award we’ve received and there is a good number of projects that are, say, $30 million and below that are coming through that we don’t announce, but that we’re being awarded and they’re from those regions, whether it’s Middle East, Africa, Eastern Europe, or Central Asia.
And so the pipeline is still very good.Again, the market fundamentals around food and food production, food security, all the interruption with Ukraine, Russia still placed favorably to that pipeline. The long-term pipeline is Africa. They will definitely have development money that will flow into that area and just the pure need for political stability is foremost on government’s minds.Brian Drab Got it. Thank you very much.Operator Thank you. Our next question comes from the line of Ryan Connors with North Coast Research. Please proceed with your question.Ryan Connors Good morning. Thanks for taking my question. So, I wanted to come at the ag side from a bit of a different angle, Steve, and you talked a lot about the topline, the revenue outlook, demand outlook international versus North America.But in terms of the margin and the mix outlook, if we go under the assumption, as it seems like it’s the tone that international is going to, at least in the short run, be more of the growth driver.
That was the case in the quarter, balance of the year, probably. How does that impact the margin story and the mix in terms of the margin story and irrigation?And then — and obviously, underlying that is what is the bidding environment looked like on some of those big projects you talked about, has it gotten more competitive, less competitive, stable? Any color you can add there would be helpful.Avner Applbaum Good morning. I can start off with — with the mix, as we look at the international ag businesses for us, actually, the margin has consistently been improving in our international businesses. Brazil specifically has a very strong margin profile. As we mentioned earlier, there are two to three growing seasons. The farmer there has ability to make some good profits and so Brazil has a really good margin profile.And then when you look internationally, as we embed technology into our solutions that increases the margins if you get more into the aftermarket business.
So, as that business continues to grow and the margins continue to improve, the fact that that grows versus North America will have a less prominent impact on our margins going forward.It’s not quite yet at the North America level, some of these projects just to the magnitude of those projects will have some lower margin profile. But overall, we shouldn’t expect a significant change in margins. As we’ve seen in our first quarter, we had a very strong margin of 11.5%, which we’re really proud of and on our way to our 12%. And we expect our kind of margins to continue to stay at those higher levels and improve throughout the year.Steve Kaniewski And relative to your question about bidding, obviously, when there’s an award like an $85 million award, that’s going to be very competitive.
It brings in players from Saudi Arabia, from Europe, it’s not just our US competitor base at that point.So, they have the ability to “utilizing” a global supply team. And thankfully, we’ve built a very strong global supply chain where we can source things throughout the world and bring it together in the project location and still make money that is favorable to the company at that point.But any time you’re going to see a large project, it’s going to be very competitive. But the projects that are more in that $30 million range, I’ll say the midsized type projects not nearly as competitive.Usually, there’s a lot more cultivation that went on with the deal, specification, maybe some land use work that was done ahead of time, pumping solution type of things.
