Market Segment
January 24, 2022
Written by Michael Cowden
Steel Dynamics Inc. (SDI) posted record fourth-quarter earnings to finish a year of unprecedented profitability for domestic steel mills.
And the Fort Wayne, Ind.-based steelmaker predicted that it would benefit from increased steel consumption in 2022 compared to 2021 levels.
Domestic raw steel production surged last week, reaching its highest output in almost two decades, according to the latest American Iron and Steel Institute (AISI) figures. While the seesaw pattern continued for US production this past week, production swelled to its highest reading since Aug. 23, 2008, driven by a massive swing in the South. The increase reversed the recent downward trend, with a sharp rebound in the South accounting for nearly all the weekly gain. Production has fluctuated considerably over the past two months, reaching both an 18-year high and its lowest level since January.
Construction has been an uneven market over the last year, but data centers have been a bright spot. Ken Simonson, chief economist for the Associated General Contractors of America (AGC) sat down with SMU Editor-in-Chief Michael Cowden last week for a Community Chat. In a far-ranging conversation, Simonson spoke on the current state of construction and wider issues in the economy. (For SMU Premium subscribers, you can watch replay of the entire interview here.)
Buyers in SMU’s latest Flat-Rolled Steel Survey increasingly expect hot-rolled (HR) coil prices to keep climbing into year-end and beyond. But competitive import offers have not yet eased concerns about tight availability: most surveyed manufacturers and service centers said foreign suppliers were quoting competitive prices, while many service centers said they were still buying imports to secure additional tons. As of Tuesday, Oct. 27, current spot prices for HR coil range from $1,280 per short ton (st) to $1,330/st, averaging $1,305/st, according to SMU’s market survey. Looking two months ahead, 41% of respondents to our Oct. 28 survey expected HR coil prices to be $1,300-1,349 per short ton (st) in two months, down from 47% in our survey two weeks earlier (Slide 32).
Nucor said on Monday, Nov. 2, that its consumer spot price (CSP) for hot-rolled (HR) coil will be $1,280 per short ton (st) this week, up $10/st from last week. The CSP for HR coil from California Steel Industries (CSI) on the West Coast will be $1,350/st, also up $10/st from a week earlier. Nucor continues to offer lead times of three to five weeks, according to its letter to customers. You can track mill price announcements on our website.
It’s the scariest time of year in Washington, D.C. … election season. The city is a veritable haunted house of prognostication and speculation as everyone tries to discern which way the howling wind will blow. We’ll let the fortune tellers and prediction markets guess the outcomes of the midterms. What we do know is this: the steel industry has experienced its share of tricks and treats over the past few months. Below are a few notable steel tricks and treats this Halloween season.