One of the key questions Steel Market Update is being asked is: what is the status of steel demand being seen by manufacturers and flat rolled steel service centers in the current market? This is an area we cover during our twice monthly trends analysis of flat rolled steel market. So, let’s take a moment […]
In September net job creation was 156,000 July was revised down by 23,000 and August revised up by 16,000. Using a 3MMA, the result for September was 192,000 down from 230,000 in August. Figure 1 shows the 3MMA of the number of jobs created as the brown bars since 1990. These numbers are seasonally adjusted […]
The World Steel Association (worldsteel) released its Short Range Outlook for 2016 and 2017. According to the new report, global steel demand will increase by 0.2 percent to 1,501 million tonnes in 2016. Steel demand contracted by 3.0 percent in 2015. The 2017 forecast is for global steel demand to grow 0.5 percent to 1,510 […]
This report summarizes total steel supply from 2003 through August 2016 and year on year changes. It then compares domestic mill shipments and total supply to the market. It quantifies market direction by product and enables a side by side comparison of the degree to which imports have absorbed demand. Sources are the American Iron […]
Both manufacturing companies and flat rolled steel service centers are reporting more than 75 percent of the distributors as offering ever lower spot steel prices. The 75 percent level is important to Steel Market Update as we have pegged it as the level, when reached and maintained, as being the point of Capitulation. That point […]
According to Baker Hughes data from October 7, 2016, the U.S rig count for the week was 524 rigs exploring for or developing oil or natural gas. This is up 2 rigs compared to last week, with oil rigs up 3 to 428 rigs, gas rigs down 2 to 94 rigs, and miscellaneous rigs up […]
Buyers and sellers of flat rolled steel are becoming less enthusiastic about their company’s ability to be successful both now and into the near future. SMU Steel Buyers Sentiment Index has been steady decline since peaking with an all time high of +71 in early July 2016. Based on our latest market trends analysis Current […]
Lead times continue to be at, or slightly below year ago levels. Steel Market Update conducted our flat rolled steel market trends analysis over the course of this week. As part of our questionnaire, submitted to almost 550 companies, we ask questions regarding lead times for new orders out of the domestic steel mills by […]
With the short lead times we reported earlier in this issue, the buyers and sellers of flat rolled steel are almost unanimously reporting the steel mills as willing to negotiate hot rolled, cold rolled, galvanized and Galvalume steel prices. We found 97 percent of those responding to our survey reporting mills as willing to negotiate […]
We include here an unabridged statement from the IMF that was released on Tuesday this week which forecasts economic growth for all regions and nations through 2021. The IMF reduced its forecast for economic growth in the US in 2016 from 2.4 percent in the April forecast to 1.68 percent and in 2017 from 2.5 […]
The Steel Market Update (SMU) Price Momentum Index (MoMo) for hot rolled steel in the United States remained negative this week for the 12th consecutive week, following a 28 week long positive streak. MoMo is a trailing indicator and shows the relationship between the current U.S. hot rolled coil price movements against the previous 12-week average […]
Global manufacturing is being hampered by weak trade said IHS Markit. The September JP Morgan Global Manufacturing PMI, compiled by Markit, rose slightly to 51.0 from 50.8 in August but failed to show any significant growth in the global manufacturing industry. The global report of 28 countries showed only eight reporting deteriorating manufacturing conditions in […]
The Manufacturing ISM Report on Business showed manufacturing expanding in September after contracting in August. The Institute for Supply Management reports the September PMI was 51.5 percent, up 2.1 percent from the previous month. New orders, production and employment gained 6, 3.2 and 1.4 percentage points, respectively. The index for inventories of raw materials rose […]
The following article was produced by SMU Steel 101 instructor and consultant, Mario Briccett of Briccett and Associates. This is one in a series of articles called “Steel Buyers Basics” which can be found in the Steel Market Update website. You can reach Mario by email at: MarioBriccetti@gmail.com. Almost every day last month the WSJ […]
Virgin Atlantic and LanzaTech are experimenting with a new jet fuel made from waste industrial gases from steel mills. Lanzanol, a low carbon ethanol fuel is derived via a fermentation process from carbon monoxide gases produced during steel manufacturing. The alcohol-to-jet process was developed in collaboration with the Pacific Northwest National Lab (PNNL) with support […]
An explanation of the Key Indicators concept is given at the end of this piece for those readers who are unfamiliar with it. This will explain the difference between our view of the present situation which is subjective and our analysis of trends which is based on the latest facts available. At the end of […]
Hot rolled coils settled September on the CME at $542 per ton while Platts ($539 average) and SMU ($530 average) saw market prices as being weaker. The SMU Price Momentum Index pointed toward lower prices throughout the month and ended the month suggesting prices will continue to slide as we move into the month of […]
Last week’s Federal Reserve manufacturing reports showed mixed results in September. Kansas City, Dallas, and Richmond Federal Reserves all reported expansion in production levels but manufacturing conditions remained soft, especially in the Dallas and Richmond areas. Kansas City The Kansas City index came in at 6.0 for its best reading since December 2014 and its […]
According to Baker Hughes data from September 30, 2016, the U.S rig count for the week was 522 rigs exploring for or developing oil or natural gas. This is up 11 rigs compared to last week, with oil rigs up 7 to 425 rigs, gas rigs up 4 to 96 rigs, and miscellaneous rigs unchanged […]
The September Chicago Business Barometer indicated that production was at its highest level since January of this year. The Barometer rose 2.7 points to 54.2 on strong gains in production. The production index jumped 7.3 points to 59.8 while new orders remained unchanged from August. Backlogs remained below the neutral point of 50. Supplier deliveries […]
The Fed once again elected not raise rates in their September 21st announcement. On the 22nd Ian Bezek had this to say: “For those who wanted decisive action, the Fed’s latest move failed to please, however, there were three dissenters against the decision – a large number for the Fed – and the vast majority […]
The annualized GDP growth rate in the third estimate of the second quarter of 2016 was 1.41 percent which was slightly above the consensus expectation of 1.3 percent and an improvement from the first estimate which was 1.2 percent. GDP is measured and reported in chained 2009 dollars and in the third estimate of Q2 […]
The source of this data is the Conference Board with analysis by Steel Market Update. Please see the end of this piece for an explanation of the indicator. Consumer Confidence jumped from 92.4 in May, its lowest value since July last year, to 101.1 in August, then to 104.1 in September, it’s highest value since […]
Durable goods orders were flat in August after making gains in July. In the latest report by the Department of Commerce, new orders for manufactured durable goods, excluding transportation were down 0.4 percent, and orders excluding defense were down 1.0 percent. Orders for core capital goods, a proxy for business spending which excludes both military […]
The Steel Market Update (SMU) Price Momentum Index (MoMo) for hot rolled steel in the United States remained negative this week for the eleventh consecutive week, following a 28 week long positive streak. MoMo is a trailing indicator and shows the relationship between the current U.S. hot rolled coil price movements against the previous 12-week average […]
Last week Steel Market Update invited just under 600 steel executives to participate in our flat rolled market trends survey. As is normal with SMU surveys, we intentionally invite manufacturing companies and service centers to lead the way. Last week 45 percent of the respondents came from manufacturing and 44 percent from the steel distributors. […]
Last month we based our U.S. flat rolled steel service center shipments and inventories on a relatively conservative model. Our belief at that time was both shipments and inventory receipts would be 3 percent below the 3 year average. In actuality shipments were -3.7 percent below year-over-year levels but 7.2 percent below the 3 year […]
Flat rolled lead times continued to slip, according to those responding to last week’s Steel Market Update flat rolled market trends analysis survey. Lead times are very close to where they were at this time last year when benchmark hot rolled was being reported at $660 per ton (September 16, 2015) and then proceeded to […]
Spot steel prices are now negotiable on hot rolled, cold rolled, galvanized and Galvalume according to those responding to our mid-September 2016 flat rolled steel market trends survey. Hot rolled continues to be (almost) unanimous with 97 percent of our respondents reporting spot prices are being negotiated by their mill suppliers. At the beginning of […]
We received the following comments from a member of the financial investment community regarding the suits just filed by the domestic mills alleging the transformation of hot rolled to cold rolled or coated from China in Vietnam was just a way for China to circumvent U.S. trade duties. The complaint states that the transformation of […]