Economy

SMU's August At-a-Glance

September 2, 2021

Steel prices continued to climb through the month of August, marking one full year of increasing prices. Hot rolled steel prices increased $45 per ton ($2.25 per cwt) throughout the month, with the SMU index averaging $1,935 per ton ($96.75 per cwt) as of Tuesday. The SMU Price Momentum Indicator remains unchanged since the August 2020 adjustment to higher, indicating prices are expected to rise further in the short term.

August scrap prices were flat to down $40 per ton from July, backing off of historically high levels. Click here to view and compare prices within our interactive pricing tool.

Zinc spot prices bounced between $1.33-1.38 per pound through August, nearing the multi-year high of $1.3883 seen in early-June. Aluminum spot prices soared higher throughout the month, ending at a record-high of $1.2357 per pound as of Aug. 31. Excluding the occasional 2-5 day surges seen in aluminum spot prices, this is the highest daily price seen in over 10 years.

The SMU Buyers Sentiment Index remained highly optimistic throughout August, ending the month at record high +75 (technically recorded as a Sept. 1 reading). Viewed as a three-month moving average, buyer sentiment also reached a record high of +78.83.

Hot rolled lead times declined throughout August, ending the month at 9.79 weeks. The percentage of buyers reporting mills willing to negotiate on HR prices remains miniscule.

Key indicators of steel demand overall remained positive, as they have in recent months. The ISM Manufacturing Index indicated further expansion in the economy for the 14th consecutive month, and the AIA Billings Index, a measure of construction activity, recovered for the seventh month in a row. In the energy sector, the active drill rig count rose throughout the month, reaching a 16-month high. Total U.S. steel imports and apparent steel supply both have shown gains in recent months.

See the chart below for other key metrics in the month of August:

August at a glance

By Brett Linton, Brett@SteelMarketUpdate.com

Brett Linton

Brett Linton is a digital operations analyst for Steel Market Update, where he began his career. Linton has been in the steel industry since 2010. He has held roles as a category manager and strategic insights director at Reibus before returning to SMU in 2024. He is a graduate of The University of North Georgia with a degree in Finance and Accounting. Brett can be reached at brett@steelmarketupdate.com or 724-314-0179.