SMU Data and Models
August at a Glance
Written by John Packard
August 30, 2015
Our Steel Buyers Sentiment Index dropped for the second month in a row, however, our 3-month-moving-average rose slightly. Our Sentiment Index has been trailing what we reported during 2014 as business growth has been tempered this year versus last.
Flat rolled steel prices dropped slightly from the end of last month through the end of August. Benchmark hot rolled was down $10 per ton, cold rolled $8 per ton, galvanized $11 per ton and Galvalume $7 per ton.
SMU hot rolled coil averaged $456 per ton which was slightly lower than the $462 average produced by CRU and the $463 average of Platts.
Hot rolled futures settled at $462 per ton for the month.
Our Price Momentum Indicator remained at Neutral, even with the slippage of pricing during the course of the month. We remain at Neutral as we closely watch what will happen as the negotiations between the USW and ArcelorMittal and US Steel come to a head. SMU is not expecting any lockout or strike immediately following the expiration of the existing contract – this situation could play out for awhile (as did ATI before they locked out the union).
Scrap prices were down $10 to $20 per gross ton during the month.
Zinc and aluminum prices both declined with zinc breaking through the $0.80 per pound level on the spot LME and aluminum below $0.70 per pound.
Iron ore prices actually rallied as did rig counts.
The MSCI inventory data was disappointing and our SMU Service Center Apparent Excess/Deficit analysis had flat rolled inventories growing rather than shrinking as we expected. Excess inventories stood at 767,000 net tons at the end of July.
Steel imports are down but continue to be above 3.0 million net tons.
Apparent steel supply grew by 300,000 tons in June (most recent month we have data).
John Packard
Read more from John PackardLatest in SMU Data and Models
SMU Survey: Sheet lead times ease further, plate hits one-year high
Steel buyers responding to this week’s SMU market survey report a continued softening in sheet lead times. Meanwhile, plate lead times have moderately extended and are at a one-year high.
SMU Survey: Buyers report more price flexibility from mills
Nearly half of the steel buyers responding to this week’s SMU market survey say domestic mills are showing increased willingness to negotiate pricing on new spot orders. This marks a significant shift from the firmer stance mills held in prior weeks.
SMU Survey: Buyers’ Sentiment Indices fall
Current Sentiment Index dropped six points to +42 this week compared to two weeks earlier. It has fallen in every successive survey since reaching a 2025 high of +66 on Feb. 19.
March service center shipments and inventories report
Steel service center shipments and inventories report through March 2024.
Apparent steel supply contracts in February
The amount of finished steel that entered the US market in February receded from January’s peak, according to our analysis of Department of Commerce and American Iron and Steel Institute (AISI) data.