The Chicago Business Barometer rose 0.6 points in January to 59.4 from a revised reading of 58.8 in December. The increased manufacturing activity follows two consecutive months of declines. The index showed a modest increase in a new orders, order backlogs and production, driving employment to a 14-month high. Inflationary pressures eased for the fourth […]
The states compile their employment numbers independently of the Feds then both are reported by the Bureau of Labor Statistics. The results are reasonably close with the Feds reporting total job creation in 2014 of 2,968,000 and the states reporting 2,664,000. Figure 1 and Figure 2 show the history of Federal and State totals since […]
The Bureau of Economic Analysis (BEA) released the first estimate of Q4 2014 Annual Revision of the National Income and Product Accounts on Friday. The annualized growth rate in the 4th Q disappointed economic pundits by coming in at 2.64 percent after increasing by almost 5.0 percent in Q3. GDP is measured and reported in […]
The spread between world hot rolled export pricing and that of the domestic average here in the United States is shrinking based on our analysis of steel pricing data from this week. As the spread shrinks, the competitiveness of imported steel into the United States is reduced. Over time, if the trend continues, the domestic […]
The fall in hot rolled futures prices seems to have slowed with the CRU down only $6/ton this week compared to an $18/ton drop the week prior. The second half of the year seems to have stabilized with trades being done at $570-575/ton for Q3 and Q4. The near term remains softer with bids retreating […]
Chinese steel trade data was recently released for the month of December 2014, providing updated data on iron ore imports, steel scrap imports, and flat rolled imports and exports. Chinese imports of iron ore in December were 86,850,000 metric tons, an increase of 28.9 percent from the previous month and an increase of 18.4 percent […]
The consumer confidence index as reported by the Conference Board rose strongly in January and the December results were revised upwards. The composite rose from 93.1 to 102.9, the view of the present situation rose from 99.9 to 102.6 as expectations rose from 88.5 to 96.4. This was the first time for the composite to […]
Turmoil continues in the global currency markets as the European Central Bank announced a quantitative easing program last week, S&P downgraded Russian debt to junk status yesterday, the Greek national election on Sunday will result in a strong resistance to EU mandated austerity programs and the Swiss removed the currency cap vs the Euro last […]
The following is the Chicago Federal Reserve statement followed by our own graphical analysis. The CFNAI is an excellent reality check for much of the economic analysis that we routinely provide in The Steel Market Update. An explanation of the Index is provided at the end of this piece. Index shows economic growth slowed in […]
New orders for durable goods in December fell by 3.4 percent from November’s level to $230.5 billion, economists had expected a 0.5 percent gain. The three month moving average (3MMA) fell by 1.7 percent. The December result is a sharp deviation from the trend line that has existed since the recession, (Figure 1). The huge […]
Ship owners are reporting “staggering losses” says the January 15 MID-SHIP Report. “Dry cargo freight rates are basically in “free fall” because of very low bunker costs coupled with major over supply of ships thus forcing freight levels down to where they were in 1982-1986,” according to MID-SHIP. The Baltic Indices all registered declines in […]
Metalforming companies reported softening in shipments at the end of 2014 but are generally optimistic about prospects for 2015. The January 2015 Precision Metalforming Association (PMA) Business Conditions Report follows. CLEVELAND, OH—January 21, 2015—According to the January 2015 Precision Metalforming Association (PMA) Business Conditions Report, metalforming companies are optimistic about business conditions during the next […]
The following article on the futures markets was written by Andre Marshall, CEO of Crunch Risk, LLC. Financial Markets: The S&P continues to perform, we are last 2054 on the March futures after testing our recent low at 1981 on the 16th. It looks like we are headed back to take out the highs at […]
Alaskan plans to upgrade the Prince Rupert ferry terminal have been scrapped after Canada moved to bar a Buy America requirement for contract bids on the project. The enactment of a ruling under the Foreign Extraterritorial Measures Act would have imposed fines of up to $1.5 million (US $1.2 million) and/or jail time for corporations […]
The three T’s, taxes, trade and transportation, are top issues the American Iron and Steel Institute (AISI) hoped would be addressed by President Obama in the State of the Union address earlier this week. AISI president and CEO Thomas Gibson expressed disappointment in the President’s address which had some “positive elements for the manufacturing sector” […]
The Architecture Billings Index rebounded to 52.2 in December from 50.9 in November, according to the American Institute of Architects. Demand for design services increased in ten of the twelve months of 2014. The new projects inquiry index dropped slightly to 58.2 from 58.8 in the previous month while design contracts were at 49.9 after […]
“A perfect storm of congestion” is how one official referred to conditions at West Coast ports. Sitting offshore on Friday were 18 vessels waiting to dock—normally there are zero, said Philip Sanfield, Director of Media Relations, Port of Los Angeles. The congestion at the port is due to several causes, said Sanfield. Larger cargo vessels […]
Gulf ports are not experiencing the horrific congestion issues seen in the West. Fleetwood Port Logistics, out of Houston and Savannah, that deals primarily in break bulk steel products, has seen little to no congestion at the primary discharge terminal of North City Docks, Port of Houston. There has been some congestion at the smaller […]
Both these data points are reported in the Federal Reserve G17 data base. The IP index was reported as 106.51 for December a decline of 0.1 percent from November. The three month moving average (3MMA) was 106.13 which was the highest value ever and the seventh straight month where the growth of the 3MMA exceeded […]
The Cass Freight Index report showed a 6.3 percent month-over-month drop in shipment volume in December, in line with seasonal expectations. The peak holiday shipping season is generally July to September, but Cass Information Systems says the peak in 2014 was earlier due to concerns related to the expiration of the ILWU labor contract at […]
Each quarter ITR Economics and HARDI offer a forecast on the construction industry. Steel Market Update provides a summary of that forecast on a national and regional basis. This week we are going to change our format slightly and provide the national forecast summary based on ITR’s Interactive Regional Economic Forecast Webinar. We will provide […]
The spread between world hot rolled export pricing and that of the domestic average here in the United States is shrinking based on our analysis of steel pricing data from this week. As the spread shrinks, the competitiveness of imported steel into the United States is reduced. Over time, if the trend continues, the domestic […]
A paradigm shift seems to be underway in the HRC futures market now that prices have broken through the critical support level of $600. The CRU is now at $584, which is down over 10 percent from around $665 just three months ago. With futures contracts trading at $580 per ton for the first half […]
A fresh challenge to advanced high strength steel has emerged with a new product from Alcoa called Micromill. The new alloy is stronger, lighter and more formable than previous aluminum alloys. “We cracked the magic formula,” said Alcoa CEO Klaus Kleinfeld during the Q4 2014 earnings call. “In the past, if you wanted more formability, […]
The current activity index of the Philadelphia Manufacturing Business Outlook Survey dropped 18 points to register 6.3 in January, widely missing economic estimates of 18.7 for the month. The decrease indicates slower growth and was accompanied by a drop in new orders and shipments. The shipments index registered a negative reading, falling 22 points to […]
The Empire State Manufacturing Survey indicated expanding business activity in January. The headline general business conditions index climbed 11 points to 10.0 after falling below zero last month. New orders had a modest increase rising six points to 6.1, as did shipments with a seven point rise to 9.6. The unfilled orders index remained negative […]
Esmark Inc. can finally celebrate the acquisition of Zelezara Smederevo Steel Works. Chairman and CEO James Bouchard announced Monday that Esmark Europe had been officially notified by the Republic of Serbia as the winning bidder for the steel works. The recently formed entity Esmark Europe BV will have a controlling 80.1 percent stake in the […]
In previous months we have reported on steel mill shipments and total supply to the market separately in alternate months with reference to imports which account for most of the difference. In future we will report on shipments and supply in one single report to measure the degree to which imports have absorbed the increased […]
The Bureau of Labor Statistics (BLS) report on non-farm employment indicated that 252,000 jobs were added in December, November and October were revised up by a total of 50,000. The three month moving average (3MMA) of gains in December was second only to November as the highest since May 2010 at 289,000. This job recovery […]
Our report on the futures markets comes to us from Andre Marshall, CEO of Crunch Risk, LLC and the instructor for our Managing Price Risk I and II workshops. Andre will discuss the hot rolled coil futures (HRC) trading done over the past few days as well as trading of Busheling scrap (BUS) and iron […]