Flat Rolled Number of Month's Supply at 2.0, Lowest Level Since Oct 2013

Carbon Flat Rolled

Domestic distributors shipped a total of 2,327,900 net tons which is 0.5 percent less than one year ago but above the previous month when service centers shipped 2,179,300 tons. The daily shipment rate came in at 105,800 net tons which was 2,000 tons per day better than the month of May.

Inventories of carbon flat rolled stood at 4,753,700 down 15.2 percent from year ago levels and lower than the 4,768,200 tons seen at the end of May. Months on hand now stand at 2.0 months as the trend toward lower inventories continued. At the end of May inventories of flat rolled stood at 2.2 months supply.

The 2.0 months supply is the lowest number of month’s supply since October 2013 (1.9 months).

SMU Note: Coated steel inventories dropped from 1.67 months in May to 1.47 months at the end of June. This is something that buyers of galvanized and Galvalume need to be aware of. Looking back to January 2011 we have not seen coated carbon sheet month’s on hand as low as they are right now. This is very supportive of coated steel pricing out of the domestic steel mills and, as new steel replaces older steel it is also supportive of higher spot prices coming out of the service centers to their end spot customers.

Carbon Plate

Plate shipments were 271,300 tons which was significantly lower than shipments at the same point in time one year ago (26.3 percent lower). The daily shipment rate was 12,300 tons per day, down 1,000 tons per day from the month of May.

Plate inventories grew during the month of June and now stand at 828,100 tons. Even so, this is 26 percent lower than the inventories being carried one year ago. The number of months on hand now stands at 3.1 months up from 2.8 months.

Pipe & Tube

U.S. pipe and tube service centers shipped a total of 205,500 tons of the product. This is 11.3 percent lower than year ago levels. The 9,300 tons per day of shipments was slightly lower than the prior month (9,500 tons per day) and below the 10,500 tons per day shipped in June 2015.

Inventories of pipe and tube stood at 554,600 tons as of the end of June 2016. Pipe and tube inventories are down slightly month-over-month (555,200 tons at the end of May) and are 20.2 percent lower than year ago levels.

The number of month’s supply on hand went from 2.8 months at the end of May to 2.7 months as of the end of June.