SMU Data and Models

SMU Sentiment Index: Optimism Continues Despite Weather

Written by Brett Linton

Steel Market Update (SMU) began collecting responses for the mid-February flat rolled steel market survey during the week of February 17th. Even with weather related issues being felt around the country, our Buyers Sentiment Index was measured at a robust +39 at that time. That result was one point lower than from our last measurement which was made during early-February. Sentiment is clearly rooted in an strong optimistic trend which began in the middle of June 2013 when Sentiment jumped from +22 (and lower in prior months) to +35 and has averaged +39 ever since.

The three month moving average (3MMA) is +40.33, a one point improvement from both two weeks ago and one month ago. One year ago SMU Steel Buyers Sentiment Index 3MMA was recorded at +23.5 and was trending lower. To view a history of the SMU Steel Buyers Sentiment Index click here.

SMU Future Steel Buyers Sentiment Index, which measures how individuals within the flat rolled steel industry feel about their company’s ability to be successful three to six months from today, was measured at +56 which is up six points from earlier in February. The highest we have measured Future Sentiment was the +57 recorded in December 2013. Last year at this time Future Sentiment was reported to be +43.

What is preventing the Index from moving even higher appears to be related to weather issues – particularly in the Midwest and Northeastern sections of the United States. As well as early signs of slipping flat rolled spot prices which impacts the value of inventories and complicates the selling process. We were also reminded that the construction industries, although improved, are still a long way from being back to pre-2007 levels.

What respondents are saying:

“Looks like demand will be fairly strong once weather issues are behind us.”

“The extreme winter that has covered the country has slowed down orders from our customers. Which may be a good thing since the trucking situation is also a nightmare and raw materials are late.”

“Weather has made for poor demand over past few weeks, hopefully as weather conditions improve demand will follow, hard winter could make really big spring.”

“The weather is really putting a damper on construction.”

About the SMU Steel Buyers Sentiment Indices

SMU Steel 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 success 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 approximately 600 North American companies to participate in our survey. Our normal response rate is approximately 120-170 companies. Of those responding to this week’s survey, 49 percent were manufacturing companies (up from 43 percent in our last survey) and 37 percent were service centers/distributors (down from 42 percent in our last survey). The balance of respondents were 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.

Brett Linton

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SMU market survey results now available

The latest SMU market survey results are now available on our website to all premium members. After logging in at, visit the pricing and analysis tab and look under the “survey results” section for “latest survey results.” Historical survey results are also available under that selection. If you need help accessing the survey results, or if your company would like to have your voice heard in our future surveys, contact