SMU Data and Models
SMU Service Center Apparent Excess/Deficit Forecast
Written by John Packard
January 21, 2015
Steel Market Update nailed (for lack of a better term…) our service center apparent excess shipment forecast which we provided to our Premium level members this past month. Based on an expectation that flat rolled carbon steel shipments would be up by 2 percent over total shipments for December 2013, we predicted shipments would be 1,968,000 tons and MSCI final December shipments actually totaled 2,005,000 tons.
We missed hitting the shipment number by 37,000 tons (our apologies, we will try to do better this month).
Last month we forecast that total steel receipts for the month of December would be 6,056,000 tons. The actual receipts according to the MSCI data released earlier this week were 6,186,000 tons. To that number we added a foreign steel inventory adjustment of 50,000 tons which took our number up to 6,106,000 tons or -80,000 tons shy of the MSCI final number.
In the table below, we are providing our latest service center inventory and shipment forecast for the next 5 months. Our forecast is based on the following premise:
Shipments, which were up 3.8 percent during the January through May 2014 versus the same period the previous year (Jan-May 2013), would exceed 2014 levels by 2 percent. We believe the energy crisis which is impacting OCTG, line pipe and possibly other products would decrease shipments by about 1 percent during this time period. Total shipments of U.S. service center flat rolled are projected to be 2,415,500 tons for the month of January.
Receipts are projected to be up 5 percent during January 2015 vs. 2014. We have also made an inventory adjustment of 100,000 tons to accommodate excess foreign inventories. Total receipts for the month of January are forecast to be 2,769,500 tons.
Our forecast for the months beyond January are based on receipts being 3 percent for February, 5 percent above March and then no change in April and May to the prior month. We believe the service centers will need to correct inventories and we should see the results beginning in April and May.
This is what all of that looks like:
John Packard
Read more from John PackardLatest in SMU Data and Models
May service center shipments and inventories report
Flat rolled = 57.1 shipping days of supply Plate = 55.7 shipping days of supply Flat rolled US service centers reined in flat roll supply in May, coinciding with declining shipments. At the end of May, service centers carried 57.1 shipping days of supply, according to adjusted SMU data. That’s down slightly from 57.6 shipping […]
Survey says: Market hit with another blast of tariff whiplash
If you’re feeling a sudden jerk and a case of tariff whiplash coming on, you’re not alone.
SMU flat-rolled market survey results now available
SMU’s latest steel buyers market survey results are now available on our website to all premium members. After logging in at steelmarketupdate.com, visit the pricing and analysis tab and look under the “survey results” section for “latest survey results.” Past survey results are also available under that selection. If you need help accessing the survey results, or if […]
SMU Survey: Steel Buyers’ Sentiment sinks to near pandemic levels
SMU’s Steel Buyers’ Sentiment Indices moved in opposing directions this week. Our Current Steel Buyers’ Sentiment Index sharply fell to one of the lowest levels recorded in five years, while Future Buyers’ Sentiment marginally improved.
SMU Survey: Mill lead times tick higher after late-May lows
All five of the averages for sheet and plate mill lead times tracked by SMU extended moderately this week, according to buyers responding to our latest market survey.