Buyers and sellers of flat rolled steel continue to be optimistic about their company’s ability to be successful both now and into the future. However, Steel Market Update has been seeing small adjustments lower to both our current and future Sentiment Indices.
Future Sentiment, which measures how buyers and sellers feel about their company’s ability to be successful three to six months into the future, was measured this week at +60 which is down 1 point from our mid-April analysis but is up 3 points compared to one month ago. One year ago our Future Sentiment Index was reported to be +64.
Looking at the numbers from a three month moving average perspective our Future Sentiment Index is now +60.17 down from the +60.67 reported during the middle of April and lower than the +60.83 reported at the beginning of April. One year ago the 3MMA was +61.83.
Current Sentiment Lower by 4 Points from Mid-April
Based on our latest market analysis flat rolled steel buyers and sellers put Current Sentiment at +50, down 4 points from mid April and 3 points from the beginning of the month. One year ago Current Sentiment was reported at +59.
Looking at Current Sentiment from a three month moving average basis we found Sentiment had improved from the +51.33 reported during the mid of April (+51.67 was the beginning of April). One year ago Current Sentiment was pegged at +59.
Normally, we see a small rise in Sentiment once the domestic mills begin announcing price increases. What we are seeing this time is Sentiment is optimistic in a flat sort of way. We haven’t been seeing any meaningful changes in the numbers as the industry waits for something other than automotive to lead the way. We saw the negativism coming out in some of the comments left behind during the survey process:
“Trying to find a bottom.”
“Many customers missed forecast in April.”
“[Business] sucks today – will suck in 6 months too.”
“In our particular case, we can offer both domestic products and import. This gives us more scope in the marketplace and flexibility.”
“Day to day in this market.”
About the SMU Steel Buyers Sentiment Index
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 participate in our survey to almost 600 North American companies. Our normal response rate is approximately 110-170 companies. Of those responding to this week’s survey, 45 percent were manufacturing and 41 percent were service centers/distributors. The balance of the respondents are made up of steel mills, trading companies and toll processors involved in the steel business.
Click here to view an interactive graphic of the SMU Steel Buyers Sentiment Index or the SMU Future Steel Buyers Sentiment Index.
John PackardRead more from John Packard
Latest in SMU Data and Models
SMU survey: Steel Buyers Sentiment Indices rise
SMU’s Current and Future Steel Buyers Sentiment Indices have both increased, based on our most recent survey data as of Wednesday, Nov. 22.
SMU survey: Lead times extend as pricing climbs
Lead times for all steel sheet products but cold rolled were extended last week as prices trend upwards.
SMU survey: Mills less willing to talk price on sheet, plate
The percentage of steel buyers saying mills were willing to negotiate spot pricing has fallen for all products SMU surveys, according to our most recent survey data.
Galvanized Sheet’s Premium Over Hot Rolled Hovering Around $200/Ton
The spread between hot-rolled coil (HRC) and galvanized sheet base prices has been hovering near $200 per net ton since late July, according to SMU’s latest analysis.
SMU Steel Demand Index Improves Again, Moves Into Expansion Territory
Steel Market Update’s Steel Demand Index has moved into growth territory after seeing steady improvement since mid-September, according to our latest survey data.