Steel Markets
Dodge Momentum Index Rebounds in July
Written by David Schollaert
August 9, 2022
The Dodge Momentum Index moved 2.9% higher in July, gaining ground on the upwardly revised reading for the month prior, according to data and analytics from the Dodge Construction Network. The index registered 178.7 last month, up from 173.6 in June.
The leading index for commercial real estate measures data about planned nonresidential building projects to track spending in the sector. For July, the subcomponents diverged, though, with the institutional component of the Momentum Index slipping 2% while the commercial component increased 5.5%.
July’s increase in the headline index, according to the report, pushed the level of planning above the most recent cyclical high reached in May.
During the month of July, commercial planning was led higher by an increase in data center, office, and warehouse projects. Institutional planning was driven down by fewer education and healthcare projects.
Compared to July 2021, the overall Momentum Index was 8% higher last month. The institutional component was down 3%, while the commercial component was 15% higher on a year-over-year basis.
The report noted that a total of 14 projects with a value of $100 million or more entered planning in July. The leading commercial projects were the $300 million Schnitzer Industrial Park in Sacramento, Calif., the $275 million Parteere 42 mixed-use complex in Miami, Fla., and the $180 million Edgecore Data Center in Sterling, Va. The leading institutional projects were the $500 million Vanderbilt University Medical Center in Nashville, Tenn., a $157 million life sciences building in San Francisco, Calif., and the $150 million Cal Poly Humboldt Craftman’s student housing project in Arcata, Calif.
The headline index has yet to show signs of stress despite growing recession fears, the report said. “This shows that developers and owners remain confident that nonresidential building projects will weather the storm of higher interest rates and a slowing economy,” said Richard Branch, Dodge’s chief economist.
Whether the trend can be sustained over the medium term is unclear, ultimately dictating the pattern for construction starts in 2023, added Branch.
An interactive history of the Dodge Momentum Index is available on our website. If you need assistance logging into or navigating the website, please contact us at info@SteelMarketUpdate.com.
By David Schollaert, David@SteelMarketUpdate.com
David Schollaert
Read more from David SchollaertLatest 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.