SMU Data and Models
Current Steel Buyers Sentiment Falls, Future Flat
May 12, 2023
SMU’s Current Steel Buyers Sentiment Index dropped four points this week compared with two weeks ago, while the Future Buyers Sentiment Index remained unchanged, according to our most recent survey data.
The Steel Buyers Sentiment Indices measure how steel buyers feel about their company’s chances to succeed 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 dating to 2008.
SMU’s Current Buyers Sentiment Index stood at +74 this week, down from +78 two weeks earlier (Figure 1). With steel prices falling and concerns about the economy rising, we’ll see if the recent cooling of current sentiment becomes a trend.
SMU’s Future Buyers Sentiment Index measures buyers’ feelings about business conditions three to six months in the future. This week, the index was unchanged at +63, where it has been for the previous two market checks. Buyers could have a cautious, wait-and-see attitude as we start to move into 2H 2023. We continue to monitor whether the gap between current and future sentiment narrows.
Measured as a three-month moving average, the Current Sentiment 3MMA was flat at +76.67 vs. the previous check (Figure 3).
The Future Sentiment 3MMA stood at +66.0, down from +67.50 two weeks ago (Figure 4).
What SMU Survey Respondents Had to Say:
“Demand is steady. Customer backlog looks good.”
“I think plate will hold up through the balance of the year.”
“Order book is improving. Demand is good.”
“Expect June to be very tough.”
“Import competition.”
“When the market stabilizes, we are in position to take advantage.”
“Only buying to replenish as needed.”
About the SMU Steel Buyers Sentiment Index
The SMU Steel Buyers Sentiment Index measures the attitude of buyers and sellers of flat-rolled steel products in North America. 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 twice per month.
Click here to view an interactive graphic of the SMU Current Steel Buyers Sentiment Index and of the SMU Future Steel Buyers Sentiment Index.
By Ethan Bernard, ethan@steelmarketupdate.com
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