Market Feels Momentum Heading into 2018

• “It was a record year!” Steel Mill
• “It was the best year in the history of the company, with a 28 percent increase in tons.” Manufacturer/OEM
• “We exceeded our expectations despite numerous unforeseen setbacks.” Trading Company
• “We missed our tonnage forecast by a substantial amount, but we exceeded our sales forecast due to CRU prices moving higher.” Service Center/Wholesaler

For others, not so much:

• “We were too optimistic in the first half.” Service Center/Wholesaler
• “Section 232 derailed our shipment plan for 2017.” Trading Company

What are companies predicting for 2018? The majority (55 percent) expect to exceed 2017 business levels, while 42 percent anticipate more of the same. Only about 3 percent foresee weaker business conditions in the coming year.

As one mill executive commented: “There’s lots of momentum entering 2018.”

What’s the View of Demand?

How does the marketplace view flat rolled steel demand heading into the New Year? Two-thirds of the respondents to Steel Market Update’s latest market trends questionnaire report they see demand remaining about the same (albeit at a fairly high level). Only 28 percent see demand improving. And 6 percent report declining demand. Whether demand will be strong enough to support the latest round of mill price increases remains an open question. Following are some respondents’ comments:

• “December was very soft.”
• “Demand is improving slightly.”
• “Just a slow start to the year so far, but only a few days in.”
• “Demand’s improving, but only from the first of the year rush where customers lowered their inventory at the end of the year.”
• “Improving in some areas and remaining the same in others. The only decline is due to weather conditions.”
• “Demand is steady and I suspect it will grow in the first quarter.”
• “Stronger demand from Florida due to hurricane repairs.”
• “January and February are booking at a very strong rate.”