Steel Markets
Heating and Cooling Equipment Shipments Fall Hard in July
Written by Brett Linton
September 9, 2022
US heating and cooling equipment shipments fell 20% in July to 1.79 million units, an eight-month low according to data from the Air Conditioning, Heating, and Refrigeration Institute (AHRI). This is the largest month-over-month (MoM) percentage decline seen since November 2020, and the largest monthly decline in shipments since April 2020.
Recall that June 2022 represented the fifth-highest monthly shipment rate in our 14-plus-year history. Shipments are also cyclical in nature; June tends to be the month with the highest shipments.
Total shipments in July are down 15% YoY, and down 12-15% compared to the same month in 2018-2020. The last time that shipments were this low for the month of July was in 2017 at 1.69 million units.
Shipments remain strong on a twelve-month moving average (12MMA) basis, averaging 2 million tons per month over the past year. This is down 1% from the 12MMA for the month prior, and 2% less than the record-high 12MMA seen in March. Shipments averaged 2.03 million units per month in 2021, up 10% compared to 1.85 million units per month shipped in the same period of 2020.
As shown in the chart below, total heating and cooling shipments on a three-month moving average (3MMA) basis are down 7% year-over-year (YoY). This is the largest decline seen since June 2020. Prior to May of this year, we saw an annual growth rate between 2–3% for each month since November 2021. May and June 2021 hold the record high 3MMA annual rates of change at 32% and 27%, respectively. Prior to 2020, the record high was 17% in February 2015.
Residential and commercial storage water heater shipments decreased 30% YoY to a combined 584,000 units in July; 567,000 units were shipped for residential use and 16,000 units for commercial use. Water heater shipments were down 17% MoM.
July shipments of warm air furnaces totaled 302,000 units, a decrease of 4% compared to the same month last year. Prior to June, warm air furnace shipments decreased on a YoY basis for six consecutive months. Shipments for warm air furnaces fell 24% from June.
Central air conditioners and air-source heat pump shipments were down 5% compared to one year ago at 900,000 total units in July: 538,000 air conditioners and 362,000 heat pumps were shipped. AC and heat pump shipments were down 21% compared to one month prior.
Year-to-date (YTD) shipments through July 2022 now total 14.13 million units. This is 393,000 units fewer than shipments in the first seven months of 2021 (14.52 million), but up from 12.52 million units in the same period of 2020 and 12.75 million units in 2019.
As seen in the chart below, 2022 YTD shipments for water heaters total 5.37 million units, 9% below the same period of 2021. Warm air furnace shipments total 2.32 million units YTD, down 2% versus last year. YTD air conditioner shipments reached 6.44 million units in the first seven months of this year, up 3% from the same period last year, and again the highest YTD figure seen in our data history.
The full press release is available on the AHRI website here.
An interactive history of heating and cooling equipment shipment data is available here on our website. If you need assistance logging in to or navigating the website, please contact us at Info@SteelMarketUpdate.com.
By Brett Linton, Brett@SteelMarketUpdate.com
Brett Linton
Read more from Brett LintonLatest 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.