World steel production is down this year. Between May and July, global steel production declined by 4.1 percent. For the year, steel output is down by 0.9 percent, excluding China which continues to overproduce. Capacity is calculated to be 2.4 billion metric tons and capacity utilization in July was 79.0 percent, according to the latest […]
The ISM Manufacturing Index fell to 49.1 percent in August from 51.2 percent in July indicating a contraction in business activity and the lowest level since the 48.0 percent reading in January 2016. “Comments from the panel reflect a notable decrease in business confidence,” said Timothy R. Fiore, chairman of the Institute for Supply Management […]
The global manufacturing sector downturn continued to worsen in August. The J.P.Morgan Global Manufacturing PMI posted a 49.5 for its fourth month of contraction. More than half of the nations surveyed by J.P.Morgan and IHS Markit had PMI readings below the neutral 50 mark last month, with Germany and the Czech Republic declining at the […]
The metalforming sector continues to express uncertainty about near-term business conditions, according to the August 2019 Precision Metalforming Association Business Conditions Report. The August report shows that 27 percent of participants anticipate an improvement in economic activity during the next three months (an increase from just 16 percent in July), 46 percent expect no change […]
The Chicago Business Barometer rose six points in August after two months of contraction. The Index posted a 50.4 last month, compared to 44.4 in July. MNI Indicators still sees an overall softening in business conditions despite the gains in August. The three-month moving average, a better indicator of conditions, fell to 48.2 Supplier deliveries […]
Don’t get too worried about a recession just yet, advised ITR economist Alan Beaulieu at the SMU 2019 Steel Summit in Atlanta this week. The economy is slowing down and consumption will be tepid for the rest of this year and into the first half of 2020. But conditions will improve in the second half […]
Oil production in the U.S. set another all-time record in May (latest data available) and the forecast for the rest of 2019 and 2020 is a continuation of this trend. The spot price of West Texas Intermediate (WTI) FOB Cushing, Okla., exceeded $60 per barrel for one day on July 10 before falling back to […]
U.S. gross domestic product had positive growth in every region of the country in all four quarters of 2018 and in Q1 2019, according to Bureau of Economic Analysis data. The BEA introduced a new data set for GDP by state and region in 2014 and backdated it to Q1 2005. This week, the data […]
Orders for durable goods increased for a second month, gaining 2.1 percent in July, according the latest data from the Commerce Department. Transportation again led the gain with a surge of 47.8 percent for aircraft and parts. Excluding the volatile transportation category, durable goods orders were down 0.4 percent. Core capital goods, non-defense minus aircraft and […]
Steel Market Update’s Steel Buyers Sentiment Index moved lower over the past two weeks as buyers appear concerned about the economy and steel demand. Steel prices remain a source of anxiety as the mills have been only partially successful at collecting their recent price increases. The goal of SMU’s Buyers Sentiment Index is to measure […]
The U.S. active rotary rig count, an indicator of oil country tubular goods demand, declined this week, according to oilfield services company Baker Hughes. The number of active U.S. rigs fell by 19 to 916, with oil rigs down 16, gas rigs down 3, and miscellaneous rigs unchanged. Compared to this time last year, the […]
If the price increases announced by the mills over the past two months were gaining real traction, it should be showing up in lengthening mill lead times. According to Steel Market Update data, the impact on lead times has been mixed and minimal. Lead times for steel delivery are a measure of demand at the […]
There has been little change in the tone of price talks over the past two weeks. The majority of buyers continue to report that mills generally are willing to negotiate to secure spot orders, even as they work to collect recent price increases on flat rolled and plate products. Since late June, the mills have […]
Material Sciences Corp. was named as one of five winners of the 2019 Altair Enlightment Award given to honor the greatest achievement in vehicle weight savings. MSC was honored for its MSC Smart Steel, a new multilayer steel laminate engineered as a direct substitute for low carbon steel stamped vehicle body parts. Offering a 20 […]
Using U.S. International Trade Commission (USITC) data, SMU has taken the import tonnage of cold rolled sheet and broken it down into coil and leveled, then into four thickness ranges, and then identifies how much was full hard, annealed and high strength. Through June 2019, of the total cold rolled sheet and strip imports into […]
The labor productivity of nonfarm businesses grew by 2.3 percent in the second quarter of 2019. The average of the last six quarters has been 0.40 percent. Unit labor costs increased 2.5 percent year over year, according to Steel Market Update’s latest analysis of Bureau of Labor Statistics (BLS) data. Unit labor costs and productivity […]
The official economic statistics out of China showed a decline in industrial production in July. But in June, China’s share of global steel production was 55.1 percent. Once each quarter we publish the official statistics for Chinese GDP, industrial production, consumer price inflation and fixed asset investment. We don’t know the accuracy of these numbers, […]
Our analysis of 11 manufacturing indicators suggests that growth is slowing and, if trends continue, will become negative in the fourth quarter. This report summarizes 11 data streams that describe the state of U.S. manufacturing in general and the steel industry in particular. We have reported on most of these separately in our Steel Market […]
By CRU Principal Analyst Josh Spoores U.S. Steel recently announced its intent to withdraw from spot market-linked adjustable price contracts in 2020 (i.e. contracts where the price moves with the spot market in some way). The following offers insight on the use of such contracts and what may come about if the intended change is […]
The upturn in steel prices appears to have some staying power as both service centers and their manufacturer customers reported rising prices in the first half of July, according to findings from Steel Market Update’s latest market trends questionnaire. As seen in the chart below, the majority of service centers (54 percent) said they are […]
Despite concerns over trade wars and recession, the Empire State Manufacturing Index expanded in August. The index from the Federal Reserve Bank of New York showed modest improvement in August, beating economists’ expectations. The general business index rose for a second month, increasing to 4.8 from 4.3 in July. “New orders increased after declining for […]
Job creation slowed in July but is still healthy and in its 10th year of uninterrupted expansion, according to Steel Market Update’s analysis of the latest Bureau of Labor Statistics data. In July, 16,000 jobs were created in manufacturing industries and 4,000 in construction activities. About 148,000 jobs were created in the private sector, while […]
The rate of job creation in the U.S. in 2019 is slowing, according to Steel Market Update’s analysis of the latest Bureau of Labor Statistics data. Net job creation in July declined to 164,000 from a downwardly revised 193,000 in June. June was revised down by 31,000 and May down by 10,000. Rising […]
Steel prices are up, but the same cannot be said for industry optimism. Following a brief uptick shortly after the mill price increases were announced last month, Steel Market Update’s Steel Buyers Sentiment Index has ticked back down. Steel buyers’ comments suggest that concerns about the economy, steel demand and the staying power of the higher […]
The mills may have the momentum today, but three out of four buyers responding to Steel Market Update’s market trends questionnaire this week expect that pricing push to be short-lived. About 73 percent said they expect steel prices to drop in the fourth quarter. Another 11 percent said they are not paying higher spot prices […]
Steel Market Update is pleased to share this Premium content with Executive-level members. For more information on upgrading to a Premium-level subscription, email Info@SteelMarketUpdate.com. Of the eight indicators of economic health tracked by Steel Market Update, none is flashing red. Taken as a whole, they signal that the U.S. economy is safe from recession for […]
The U.S. active rotary rig count, an indicator of oil country tubular goods demand, declined again this week, according to oilfield services company Baker Hughes. The number of active U.S. rigs fell by 8 to 934, with oil rigs down 6, gas rigs down 2, and miscellaneous rigs unchanged. Compared to this time last year, […]
For a steel industry that is hoping to collect higher prices on flat rolled and plate products, the mills seem surprisingly willing to negotiate, according to the findings from Steel Market Update’s latest market trends questionnaire. Well, then again, when you announce $120 per ton of base price increases (or more, depending on what your […]
Lead times for steel delivery are slightly longer for hot rolled, galvanized and plate steels following price increases announced by the major mills. The average lead time for hot rolled is now approaching four and a half weeks, cold rolled nearly six weeks, and coated steels around six and a half weeks. Plate lead times […]
Rising prime steel prices are bringing some welcome relief to sellers of secondary as well, but higher prices do not necessarily translate into higher margins. Sources tell Steel Market Update that conditions in the nonprime market have improved, but remain challenging. Nonprime or secondary steel includes coils that are rejected because they fail to meet […]