Economy
October at a Glance
Written by Brett Linton
November 3, 2019
Steel prices continued their decline in October to an average hot rolled price below $500 per ton, prompting a $40 per ton price increase announcement by the flat rolled mills late in the month. With a price change in play, Steel Market Update switched its Price Momentum Indicator to Neutral.
Widespread concerns about the declining prices and questionable demand took SMU’s Steel Buyers Sentiment Index to even lower levels in October. The Institute for Supply Management’s PMI, which registered 49.1 in August, 47.8 in September and 48.3 in October, remains in contraction below the 50-point level that signals growth in manufacturing. In the energy sector, the rig count declined further in October. Automotive production remains a bright spot for steel demand, although it will feel some impact from the 40-day strike by the UAW against General Motors
Adding to the downward pressure on finished steel prices in October were weak ferrous scrap prices that have also been on the decline for the past few months. Sources tell SMU they expect scrap prices to increase by at least $20/GT in November, perhaps reversing the slide.
See the chart below for more benchmarks for the month of October.
To see a history of our monthly review tables, visit our website here.
Brett Linton
Read more from Brett LintonLatest in Economy
ArcelorMittal plans wire-drawing closure in Hamilton, shifts production to Montreal
ArcelorMittal’s (AM) Hamilton location to be shuttered, wire production shifting to Montreal.
Beige Book finds growing economic, policy uncertainty
All districts reported "hesitancy and a cautious approach to business and household decisions,” according to the Beige Book.
ISM: Manufacturing continues to contract in May
May marks the third consecutive month US manufacturing activity declined, according to supply executives contributing to the Institute for Supply Management (ISM)’s latest report.
Chicago PMI decreases 4.1 points in May
The Chicago Business Barometer reports that decreases in new orders, order backlogs, and softer production pulled the index down by 4.1-points to 40.5, in May.
Architecture firms struggle through April
For the third month in a row, architecture firms reported a reduction in billings through April, according to the latest Architecture Billings Index release.