Final Thoughts

We all know steel demand hasn’t been that great. As you can see below in Slide 24 from our latest full survey results, the number of steel buyers reporting worsening overall demand increased to 34%, just over a third of respondents. While the numbers are only slightly worse than this time last year, I had to look off the chart and further back in SMU’s files to see this degree of folks seeing falling demand: It was almost three years ago, back in September 2022.

As Brett Linton points out in his article in today’s newsletter, our Steel Buyers’ Sentiment indices moved higher this week. While both indices continue to signal that buyers are generally optimistic about their company’s chances of success in the market, the degree of optimism appears to be fading.

This week’s slide on Current Steel Buyers’ Sentiment (Slide 19 below) got me thinking about just that.

The slide below is telling of how Current Sentiment has been trending. It’s a roller coaster for sure, but one that’s clearly headed downward.

So current feelings about market prospects are trending lower. Folks are still feeling good about the current market, but maybe not quite as good as they were in years past.

Comparing Current and Future Sentiment, we can see that buyers have generally been more optimistic about the future than the present situation.

But if you’ll notice in Slide 22 below, even Future Sentiment has begun to erode, with the 3MMA now at its lowest point in almost five years. Yeah, levels of optimism about the future haven’t been this low since October 2020.

Many of the charts in this week’s survey, along with current events, have me thinking about Dr. Alan Beaulieu’s presentation at last year’s SMU Steel Summit. His words, fortunately or unfortunately, hang heavy in my mind. I even wrote a note on my iPhone during his presentation that I still read often (out of fear or in preparation, I’m not quite sure). He predicted a recession, not a freefall like the Great Recession of 2008-09, but a slow, six-year decline into an eventual depression by 2030.

Summertime, and the livin’s easy…

So, with a hazy outlook in an uncertain market and a crazy world, maybe it’s good the doldrums have arrived for now. Not so ideal for the steel business, sure, but beneficial on a more personal level.

Perhaps it’s time to slow down and appreciate the people, places, and things that we work so hard for. Take that vacation. Schedule your tee times. Take your kids and dogs swimming out in nature. Put your bare feet on the grass, in the sand, in some moving water. Grab a drink and your friends and dance the evening away to live music. Stargaze, watch a meteor shower, and remember the feeling of awe and wonder. Garden and get your hands in the dirt. Go camping, kayaking, biking, hiking, or try a new outdoor activity. Hug your mom. Host a cookout. Share a hearty laugh with friends and coworkers. Kick back in a hammock. Or a personal favorite: Watch the fireflies dance at dusk. (Don’t forget to stay hydrated and wear your SPF!)

Take some time during your regularly scheduled summer maintenance outage and downtime to rest your body, clear your mind, and recharge your soul, however that looks to you. And maybe, just maybe, when we all come back together later this summer, some of the uncertainty will have passed, and hopefully, together with it, some of our stresses.

How’s that economic forecast looking now?

And maybe ITR Economics/Crowe’s Taylor St. Germain will have a better economic outlook for us at this year’s SMU Steel Summit. (Fingers crossed!) You’ll have to join us in Atlanta in August to find out.

The conference starts on Monday, Aug. 25, and runs through Wednesday, Aug. 27. Taylor closes out the event on Wednesday afternoon, right before Michael Cowden presents his live Final Thoughts. It will be worth sticking around until the very end for those presentations.

You can visit www.events.crugroup.com/smusteelsummit/home to see the full conference agenda, speaker lineup, and other event details, as well as to register.

In the meantime, I invite you to join me in trying to make the most of the summer doldrums (while still meeting targets and keeping bosses happy, of course :)!

Thank you for reading and your continued support of Steel Market Update!