Economy
June 2018 at a Glance
Written by Tim Triplett
May 31, 2018
In the table below, Steel Market Update provides a snapshot of flat rolled steel pricing, commodities that affected steel prices, and economic data of importance to the flat rolled steel industry in June.
Looking back at the past month, SMU’s Pricing Momentum Indicator continued to point higher as the domestic mills reacted to the Trump administration tariffs on steel imports, pushing the price of hot rolled over $900 per ton. The price of cold rolled topped $1,000, while galvanized was near $1,100 a ton, about the same as in April and May.
Buyers’ sentiment declined a bit in June over the uncertainty on the trade front, but SMU’s Steel Buyers Sentiment Index remained at very optimistic levels. Measured as a single data point, buyers’ sentiment averaged +64, down from +70 in May. Future buyers’ sentiment was at +59, down from +63.5 the prior month. The three-month moving average has shown little change in buyers’ attitudes since April, however.
Steel demand remained positive in June. The Institute for Supply Management’s Manufacturing Index hit 60.2, up from 57.3 in April and 58.7 in May (any reading above 50.0 indicates growth). ISM’s monthly survey of corporate purchasing executives defied expectations of a summer slowdown. In the energy sector, the U.S. rig count reached 1,055, up by 44 rigs from April, which is good news for suppliers of oil country tubular goods.
Industry inventory in June remained at a lean level around 2.3 months of supply as service centers were conservative in their purchasing in the uncertain pricing and political environment.
Refer to the chart below for other key economic data points.
To see a history of our monthly review tables, visit our website.
Tim Triplett
Read more from Tim TriplettLatest in Economy
ISM: Manufacturing growth slows in July, hits 10-month low
US manufacturing activity slowed again in July to a 10-month low
CRU: Pushing EU imports back to 15% would be a big task
Several EU member states have published a ‘non-paper’ that puts forward proposals for a post-safeguard trade measure.
SMU Community Chat: Tariff-induced panic purchases, inflation, and calculating costs
Chief executive of the Institute for Supply Management (ISM), Tom Derry highlighted how reactive buying behavior has shifted the market into a quiet demand period. Derry presented ISM data during the weekly SMU community chat.
Architecture billings still sluggish despite project inquiry uptick
The Architecture Billings Index (ABI), a leading indicator for non-residential construction activity, declined for an eighth straight month in June.
Beige Book: Tariff pressures mount, flat outlook
All districts reported “experiencing modest to pronounced input cost pressures related to tariffs, especially for raw materials used in manufacturing and construction.”