The Chicago Business Barometer dropped 3.3 points to 47.1 in September after seeing a brief rebound from contraction in August. The decline in the index released by ISM and MNI Indicators was lower than the 50+ reading expected by many economists. The September Chicago PMI, as the index is also known, marked the third contraction […]
Mexican steel producer AHMSA is seeking a way out of its financial difficulties including a possible sale of the company, according to various press reports. Altos Hornos de México is recovering from a corruption scandal that rocked company finances and coincided with a downturn in market conditions. Board of Directors President Alonso Ancira was accused […]
Orders for durable goods rose 0.2 percent to $250.7 billion in August, but most of the increase was military related. Orders for defense-related goods jumped 15 percent. Orders minus defense decreased 0.6 percent, reported the U.S. Census Bureau. Core capital goods, non-defense orders minus aircraft and an indicator of future investment, fell 0.2 percent. Economists […]
The Canadian Steel Producers Association has appointed Algoma Steel CEO Michael McQuade as Chairman of the Board of Directors. McQuade was appointed CEO of Algoma in March 2019. Prior to assuming the leadership role at Algoma, McQuade accumulated more than 35 years of experience at Stelco Inc. He moved through a variety of roles at […]
The following article on the hot rolled coil (HRC) steel and financial futures markets was written by Jack Marshall of Crunch Risk LLC. Here is how Jack saw trading over the past week: Steel A $17/ST drop in Midwest HR spot prices as reflected in the decline of the CME August HR average and the […]
Metalforming firms are expecting a slowdown in the manufacturing sector, according to the September 2019 Precision Metalforming Association Business Conditions Report. Thirty percent of participants in the monthly survey expect a decline in economic activity in the next three months, up from 27 percent in August. Those who expect no change in activity jumped to […]
Mexico will renew its tariffs covering imports of over 200 steel products for the next five years, but will decrease the rates on most products to 5 percent by September 2023. The tariffs apply to countries with which Mexico does not have a free trade agreement. The current tariff is 15 percent, but will fall […]
Thyssenkrupp AG is sacking its CEO of 14 months after directors determined Guido Kerkhoff is unable to reverse declining profits at the German conglomerate. Supervisory Board Chairman Martina Merz will be interim CEO for the next 12 months while a permanent replacement is sought. Kerkhoff succeeded Heinrich Hiesinger in July 2018. In May 2019, the […]
By CRU Principal Economist Lisa Morrison The Fed cut interest rates at the conclusion of its meeting on Sept. 18, 2019, lowering the Federal Funds rate by 25bp to a range of 1.75 to 2.00 percent. This reduction in the Fed Funds rate was widely anticipated by markets and follows a 25bp rate cut in […]
“Fragile and uncertain” is how the Organization for Economic Cooperation and Development (OECD) describes the current global economy. The OECD’s latest Interim Economic Outlook shows economic growth slowing as escalating trade conflicts impact confidence and investment and increase downside risks in financial markets. In May of 2018, the OECD was predicting global growth of 4 […]
The strike by United Auto Workers at General Motors is disrupting sister operations in Canada. As Day 5 of the strike began Friday, GM Canada announced layoffs for more than 2,500 of its workers. Union leaders expect further reductions next week. General Motors Canada laid off about 1,200 workers at the assembly plant in Oshawa […]
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 18 to 868, with oil rigs down 14, gas rigs down 5, and miscellaneous rigs up 1. Compared to this time last year, […]
The following calculation is used by Steel Market Update to identify the theoretical spread between foreign hot rolled steel prices (delivered to U.S. ports) and domestic hot rolled coil prices (FOB domestic mills). We want our readers to be aware that this is only a “theoretical” calculation as freight costs, trader margin and other costs […]
SMU contributor Gaurav Chhibbar is a partner at Metal Edge Partners, a firm engaged in Risk Management and Strategic Advisory. In this role, he and his firm design and execute risk management strategies for clients along with providing process and analytical support. In Gaurav’s previous role, he was a trader at Cargill spending time in […]
The growth of manufacturing in the U.S. is slowing, and on a single-month basis the ISM index became negative in August. This does not bode well for the balance of 2019 or for 2020, according to Steel Market Update’s analysis of 11 manufacturing indicators. This report summarizes 11 data streams that describe the state of […]
The composite producer price index of all commodities has been relatively stable in 2019, but tinware products are becoming very uncompetitive against aluminum. This report is an analysis of Bureau of Labor Statistics data performed by staff of Steel Market Update and is intended to provide subscribers with a view of the competitive position of […]
The U.S. dollar has weakened against 11 of the 16 steel trading nation currencies in the last month and against eight in the last three months. In this report we examine the change in currency values of the 16 preeminent global steel and iron ore trading nations. The currencies of these 16 don’t necessarily follow […]
The Empire State Manufacturing Index surprised economists by slipping to 2.0 on the general business index, a three point decline from August. The new orders index fell three points to 3.5, but remained above zero indicating only slight growth. The shipments index declined four points to 5.8 for it lowest level in nearly three years. […]
The following article discussing the global ferrous derivatives markets was written by David Feldstein. As an independent steel market analyst, advisor and trader, we believe he provides insightful commentary and trading ideas to our readers. Note that Steel Market Update does not take any positions on HRC or scrap trading, and any recommendations or comments […]
The rate of job creation in August slowed to 130,000 and was helped by the addition of 25,000 temporary Census workers, according to Steel Market Update’s analysis of the latest Bureau of Labor Statistics data. Net job creation in August declined to 130,000 from a downwardly revised 159,000 in July. June was revised […]
Job creation in August was disappointing even after being boosted by the addition of thousands of temporary Census workers. In August, 3,000 jobs were created in manufacturing industries and 14,000 in construction activities. A reported 96,000 jobs were created in the private sector and government gained 34,000 positions. The federal government employment result was swelled […]
The following calculation is used by Steel Market Update to identify the theoretical spread between foreign hot rolled steel prices (delivered to U.S. ports) and domestic hot rolled coil prices (FOB domestic mills). We want our readers to be aware that this is only a “theoretical” calculation as freight costs, trader margin and other costs […]
The following article on the hot rolled coil (HRC) steel and financial futures markets was written by Jack Marshall of Crunch Risk LLC. Here is how Jack saw trading over the past week: Steel In the last 30 days we have seen the prices in the HR forward curve drop by an average of $70/ST […]
Despite slight upward momentum in steel pricing in August, steel buyers’ sentiment languished in the +40s on SMU’s index. This tepid optimism likely reflects widespread concerns in the market about steel demand in the second half and the staying power of steel prices following the recent increases announced by the mills. The average price for […]
The Conference Board measure of consumer confidence is quite a volatile indicator, therefore we prefer to smooth the data with a moving average to reduce monthly variability. The composite value of consumer confidence in August was 135.1 with a three-month moving average (3MMA) of 131.7. June’s result of 124.3 now appears to be an outlier […]
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 […]