Scrap Prices North America
SMU Buyers Sentiment Indices Mixed
February 3, 2023
Current Steel Buyers Sentiment ticked up this week, while Future Steel Buyers Sentiment edged down, according to SMU’s most recent survey data.
SMU’s Steel Buyers Sentiment Indices measure how steel buyers feel about their company’s ability to be successful in the current market, as well as three to six months down the road. Every other week we poll steel buyers about sentiment. We have historical data going back to 2008.
SMU’s Current Buyers Sentiment Index stood at +76, a 2-point increase from two weeks ago (Figure 1). This is the second consecutive jump, but too early to tell if it will stick above +70. 
SMU’s Future Buyers Sentiment Index measures buyers’ feelings about business conditions three to six months in the future. Future Sentiment dropped 2 points to +71 compared with the last market check. It appears buyers are slightly more optimistic about current conditions, and less sure as we proceed into 2023.
Measured as a three-month moving average, the Current Sentiment 3MMA increased to +69.67, compared to +66.0 two weeks ago. (Figure 3).
The Future Sentiment 3MMA rose to +69.50 vs. +68.67 two weeks ago. (Figure 4).
What SMU Survey Respondents Had to Say:
“Connections with mills are weak.”
“We need to operate efficiently and make good decisions.”
“We have a favorable deal with our mills, but we lack the tons for anything game-changing.”
“We utilize hedging to minimize volatility.”
“Inventory control/new personnel coming online.”
“Steady as she goes.”
“Spring outages and start-up issues will keep supply constrained.”
“Cautiously optimistic – some service centers still dumping high-cost inventory at ridiculously low prices.”
“Demand still seems very strong, which should help with price stability in all products, not just HRC.”
About the SMU Steel Buyers Sentiment Index
The SMU Steel Buyers Sentiment Index is a measurement of the current attitude of buyers and sellers of flat-rolled steel products in North America regarding how they feel about their company’s opportunity for success in today’s market. It is a proprietary product developed by Steel Market Update for the North American steel industry. Tracking steel buyers’ sentiment is helpful in predicting their future behavior.
Positive readings run from +10 to +100. A positive reading means the meter on the right-hand side of our home page will fall in the green area indicating optimistic sentiment. Negative readings run from -10 to -100. They result in the meter on our homepage trending into the red, indicating pessimistic sentiment. A reading of “0” (+/- 10) indicates a neutral sentiment (or slightly optimistic or pessimistic), which is most likely an indicator of a shift occurring in the marketplace. Sentiment is measured via SMU surveys that are conducted twice per month.
We send invitations to participate in our survey to more than 700 North American companies. Approximately 45% of respondents are service centers/distributors, 30% are manufacturers, and the remainder are steel mills, trading companies or toll processors involved in the steel business.
Click here to view an interactive graphic of the SMU Steel Buyers Sentiment Index or the SMU Future Steel Buyers Sentiment Index.
By Ethan Bernard, ethan@steelmarketupdate.com
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