SMU Survey: Sheet and plate lead times extend to multi-year highs

The average production time for hot-rolled coil is just under six and a half weeks. Cold rolled and coated products are in the low-eight-week range, and plate is up to seven weeks.

Table 1 summarizes current lead times and recent changes by product (click to expand)

Compared to our previous market check, four of our lead-time ranges saw minor shifts this week:

• The longest hot rolled lead time we considered declined from nine weeks to eight.
• The shortest cold rolled and Galvalume lead times considered increased from five weeks to six.
• The shortest plate lead time considered increased from five weeks to six, and the longest increased from eight weeks to nine.

Buyers continue to expect stability

Over half of responding buyers (60%) expect lead times will remain stable two months from now, similar to recent surveys. The remainder is split: 24% believe lead times will soon contract, while 16% forecast extensions. Comments included:

“Flat – controlled order intake will remain suppliers’ top priority.”

“Flat – only a few mills are extended.”

“Flat – demand is no longer driving this market.”

“Flat to up.”

“Contracting – we believe we’re getting close to a frothy top (Section 301 aside), and that domestics will get hungry in the summer months.”

“Contracting – without demand, oversupply will be an issue.”

“Contracting – unsure about the economy.”

Trends

To better highlight trends, lead times can be calculated on a three-month moving average (3MMA) basis. All five of our sheet and plate 3MMAs extended again this week, a trend in place since last November (Figure 2).

Sheet 3MMA lead times remain about a week and a half longer than the two-year lows seen last September, but just three to six days longer than levels seen this time last year. The latest plate 3MMA is six days longer than it was six months ago, and a week and a half above year-ago levels.

Average lead times by product across the past three months were: hot rolled at 5.9 weeks, cold rolled at 7.5 weeks, galvanized at 7.4 weeks, Galvalume at 7.8 weeks, and plate at 6.2 weeks.

Note: These lead times are based on the average from manufacturers and steel service centers participating in this week’s SMU market trends analysis survey. SMU measures lead times as the time it takes from when an order is placed with the mill to when it is processed and ready for shipping, not including delivery time to the buyer. Our lead times do not predict what any individual may get from any specific mill supplier. Consult your mill rep for actual lead times. Premium members can view an interactive history of our steel mill lead times data on our website. If you’d like to participate in our surveys, contact smu@crugroup.com.