SMU survey: Steel Buyers' Sentiment Indices surge

Through our latest market survey results, the SMU Current Steel Buyers’ Sentiment Index jumped 10 points from two weeks prior, now back in territory last seen in early June. Current Sentiment has increased each of our last two surveys following late July’s multi-year low. Future Buyers Sentiment surged 17 points from mid-August, moving from a 14-month low to a nine-month high.

What could be driving this recovery – is the market genuinely improving? We advise caution, attributing the surge to increased optimism following our annual SMU Steel Summit Conference. Historically, our Steel Buyers’ Sentiment Indices have shown moderate gains in the weeks after each Summit, with upticks in market enthusiasm observed in seven of the past 10 years following the event.

SMU’s Current Buyers’ Sentiment Index rose to +48 this week, recovering 10 points from two weeks prior (Figure 1). Recall that Current Sentiment had fallen to +34 in both the first and last week of July, which were the lowest readings recorded since August 2020. Year to date (YTD), Current Sentiment has averaged +53 across the first eight months of 2024, significantly lower than the 2023 YTD average of +69. This time last year Current Sentiment was +55.

SMU’s Future Buyers’ Sentiment Index measures buyers’ feelings about business conditions three to six months down the road. This index jumped 17 points to +72 this week. This is now the highest Future Sentiment reading seen since November 2023. Recall that just two weeks prior it fell to the lowest value seen in over a year (Figure 2). Future Sentiment has averaged +64 since the beginning of 2024, down just two points from the same period of 2023. Future Sentiment was +66 the same week one year ago.

Measured as a three-month moving average, Buyers’ Sentiment moved in differing directions this week. The Current Sentiment 3MMA eased yet again this week, now down to a four-year low of +40.09. The Future Sentiment 3MMA changed pace, increasing to +64.34 following mid-August’s five-month low (Figure 3).

What SMU survey respondents had to say:

“We seem to buy wisely and competitively. We’ll be OK.”

“Positive – solid customer base.”

“Election years always slow us down, so after November we should see an increase in our market.”

“Our business continues to be pretty solid, but we continue to capture market share, which helps.”

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. A link to our methodology is here. If you would like to participate in our survey, please contact us at info@steelmarketupdate.com.