Steel Market Update (SMU) Steel Buyers Sentiment Index rose to +12 during our most recent survey conducted October 3rd – 5th. The latest reading is +1 point higher than the +11 measured during the middle of September. Steel Market Update Steel Buyers Sentiment Index has been range-bound since early August when it was measured at +14 down from a mid-July reading of +25. Since early August Sentiment has bounced between a high of +14 to a low of +10.

John Packard, Publisher of Steel Market Update said today, “We believe our SMU Steel Buyers Sentiment Index is not expressing the same enthusiasm which existed earlier this year as those within the steel industry begin to worry about seasonal demand issues, world economic uncertainty as well as their ability to continue to meet business forecasts.”

Even though range bound, the SMU Steel Buyers Sentiment Index has now been in the “optimistic” portion of the range since early December 2010. The highest reading during calendar year 2012 was +40 measured in early April. The lowest reading so far this year was the +10 measured in the middle of August.

During the survey process our respondents recorded the following comments:

“We see nothing on the horizon that appears to be the catalyst for significant change.” (Service Center)

“Consumer confidence is real problem. Foot traffic thru the retail stores is really down.” (Manufacturer)

“Business levels have been very consistent since May. I expect no changes as long as the weather holds.” (Manufacturer)

“Tied to the construction markets as we do not see business conditions improving. Our early projections for 2012 is it will remain at 2011 levels.” (Service Center)

“Our international customers are speaking of another good year in grain storage similar to this year.” (Manufacturer)

Our SMU Steel Buyers Sentiment Index is produced through a proprietary survey taken twice per month. SMU invites approximately 765 companies to take our steel market survey where we measure Sentiment, Trends within the industry and Steel Prices. Any reading above zero indicates a steel community which is “optimistic” about their company’s chances of being successful in the current market environment.

We would describe the current results as being “mildly optimistic” and we are seeing signs of the steel community becoming nervous about domestic and world events which could impact the need for steel and products derived from steel in the months ahead. At this time, our SMU Future Steel Buyers Sentiment Index none-the-less remains squarely in the optimistic zone at +25 which is down 2 points from our mid-September Index reading and is at its lowest level so far this calendar year.

About our SMU Steel Buyers Sentiment Index

SMU Buyers Sentiment Index is a measurement of the current attitude of buyers and sellers of flat rolled steel products in North America regarding how they feel about their company's opportunity for growth in today's market. It is a proprietary product developed by Steel Market Update for the North American steel industry.

Positive readings will run from + 10% to + 100% and the arrow will point to the right hand side of the meter located on the Home Page of our website indicating a positive or optimistic sentiment.

Negative readings will run from -10% to -100% and the arrow will point to the left hand side of the meter on our website indicating negative or pessimistic sentiment.

A reading of “0” (+/- 10%) indicates a neutral sentiment (or slightly optimistic or pessimistic) which is most likely an indicator of a shift occurring in the marketplace.

Readings are developed through Steel Market Update market surveys which are conducted twice per month. We display the index reading on a meter on the Home Page of our website for all to enjoy.

Currently we send invitations to over 775 North American companies to participate in our survey. Our normal response rate is approximately 150-200 companies. Of those responding approximately 48% are manufacturing companies, 49% are service centers/distributors and the balance is made up of steel mills, trading companies and toll processors involved in the steel business.

Steel Market Update does canvass those being invited to participate in order to confirm their active participation in the flat rolled steel business. Our list is updated at least once per month and we are adding new companies on a continuous basis.