Steel Markets
Multi-family Construction Buoys Housing Starts
Written by Sandy Williams
April 16, 2018
Housing starts increased more than expected in March due to a rebound in multi-family construction. Housing starts grew 1.9 percent from February to March to a seasonally adjusted annual rate of 1,319,000. Year-over-year, housing starts leapt 10.9 percent, reports the National Association of Home Builders.
Single-family housing starts were weak in March at a rate of 867,000, 3.7 percent below February’s revised rate of 900,000. The March rate for units in buildings with five units or more was 439,000, a 16.1 percent jump from February.
Regionally, starts edged upward in the Northeast by 0.8 percent and jumped 22.4 percent in the Midwest. Starts were down slightly in the South and West at -0.6 percent and -1.5 percent, respectively.
“The modest decline in single-family starts in March is still in line with our solid builder confidence readings and is largely attributable to lingering winter weather that is causing production delays in certain areas of the country,” said NAHB Chief Economist Robert Dietz. “With ongoing job creation, wage increases and rising household formations, we can expect continued, gradual strengthening of the housing market in the coming months.”
Bloomberg economists agreed that the outlook for housing is strong. “Fundamentals appear to support a positive outlook for the construction sector, despite labor constraints and rising material costs,” wrote Bloomberg economists Niraj Shah and Carl Riccadonna. “Demand should also be supported by a tight labor market and steady pay gains.”
Building permit authorizations climbed 2.5 percent from February to a rate of 1,354,000, up 7.5 percent from March 2017.
Single-family authorizations in March slid 5.5 percent from February to a rate of 840,000, but jumped 22.9 percent for housing with five units or more.
Regionally, authorizations declined 5.5 percent in the Northeast, but grew 9.0 percent in the Midwest, 2.1 percent in the South and 3.0 percent in the West.
Sandy Williams
Read more from Sandy WilliamsLatest in Steel Markets
GrafTech’s Q2 loss widens in ‘challenging’ business environment
GrafTech cited a “challenging” part of the business cycle as its net loss widened in the second quarter.
CRU: Poor steel margins continue to push down raw material prices
Both iron ore and coking coal prices fell this week because of resistance from buyers. Iron ore prices have continued to fall throughout the past week, following sharp declines in steel prices in China, given no new policy announcement from the ‘Third Plenum’ meeting.
Op-Ed: The myth of the Mexican steel surge
We have heard ominous warnings about a flood of Mexican steel threatening the US market. It's the kind of rhetoric that gets thrown around often with little regard for the facts. The reality is that the Mexican steel surge is simply not happening, and the US steel industry has consistently maintained a significant trade surplus in finished products with Mexico. In 2023 alone, this surplus exceeded $3 billion.
CRU: Demand weakness continues to weigh on global sheet markets
Demand has remained persistently weak across the globe for sheet steel, weighing on prices. US HR coil prices fell the furthest this week as high-volume, low-priced deals were transacted as mills looked to fill order books and competed with one another amid relative demand weakness. Meanwhile, European prices were also down due to low demand […]
Influx of coated products fuels recent import surge
Steel imports fell back in May from April’s recent high but remained elevated compared to the levels seen over the past year. A deeper dive into the data confirms what SMU has been hearing from sources: Coated sheet is driving the recent rise in overall import levels.