Durable goods orders took an unexpected decline in November, falling 0.7 percent to $242.3 billion, according to data released by the Department of Commerce. The headline figure widely missed Bloomberg’s consensus of a 3.0 gain for the month. Defense orders dropped 8.1 percent, leading November’s decline after gaining 10 percent in October. Excluding transportation, new orders […]
We received this poem from one of our manufacturing customers with a sense of humor. Enjoy and Happy Holidays to each and every one of you. T’was just 2 day’s,Before Christmas, When all through the market,The mills are so quiet,Will they hit my target? Their stocks keep dropping,The market’s a bear,The mills keep crying.“Imports aren’t […]
Metalforming companies are expecting a slight improvement in business conditions over the next three months, according to the December survey by the Precision Metalforming Association. PMA says low fuel prices may help offset manufacturing costs. Low gas prices may also push surging auto sales into 2015. The December report follows: CLEVELAND, OH—December 18, 2014—According to […]
Mexican steelmaker Altos Hornos de Mexico SAB de CV (AHMSA) has agreed to repay $1.7 billion in debt owed to creditors. The agreement lifts a 15 year suspension of payments that was granted in 1999 after AHMSA failed to meet financial requirements related to debts of $1.90 billion. The suspension allowed AHMSA time to restructure […]
Hot rolled coil futures took another leg down over the past couple of weeks as spot softness continues to weigh down the terminal market. The forward curve has moved down $5-10 per ton depending on the period for calendar 15 months. Q1 and Q2 is now trading close to $600 per ton and 2nd half […]
Canadians are outraged by the “Buy America” rule applied to a ferry terminal overhaul on Canadian soil. Funding for updating the Prince Rupert Ferry Terminal in British Columbia, leased to the State of Alaska, is coming primarily from the Federal Highway Administration, which requires Buy America rules. In the restrictions published in tendering documents by […]
The American Institute of Architects (AIA) released their Architecture Billings Index (ABI) score for the month of November on Wednesday this week, reporting that the latest index is at the lowest point in the last seven months. The ABI score for November was 50.9, down 2.8 points from October’s score of 53.7. Note that the […]
New York manufacturers reported a decline in general business conditions in the December Empire State Manufacturing Survey. The headline business conditions index fell to -3.6, a drop of 14 points and its first negative reading in two years. The new orders index slid 11 points to -2.0 while shipments dropped 11 points to -0.2. The […]
American Trucking Association applauded Congress “for the common sense fix to two unjustified provisions of the current hours-of-service restart rules in this year’s omnibus spending bill.” The Omnibus Appropriations bill, passed in a bi-partisan vote on Saturday evening, provides funding for the federal government including the Department of Transportation. An amendment to the bill temporarily […]
Both these data points are reported in the Federal Reserve G17 data base. The IP index was reported as 106.66 for November an increase of 1.26 percent from October. The three month moving average (3MMA) was 105.75 which was the highest value ever and the sixth straight month where the growth of the 3MMA exceeded […]
The currency markets continue to be dominated by a strengthening dollar and a weakening of third world currencies in particular. Hyun Song Shin, who chief economist at the Bank for International Settlements in Basel, gives a lot of thought to the implications of the current situation. In recent presentations at the Brookings Institution, Mr. Shin […]
The subject of how China is going to deal with their surging steel exports continues in earnest after the release of the most recent Chinese export data. As the graphic shows below, the Chinese steel mills have spent this calendar year flooding the world markets with their steel excesses. In November the Chinese steel mills […]
The Dodge Momentum index rose 0.6 percent to 125.0 in November according to Dodge Data & Analytics. Dodge attributes the rise to greater planning activity in the commercial sector. Commercial planning rose 4 percent for the month, however, planning activity for the institutional sector fell 3.8 percent. “After retreating from July through September, the Momentum […]
Today’s hot rolled, ferrous scrap and iron ore futures article comes to us from Andre Marshall, CEO of Crunch Risk LLC and the instructor for Steel Market Update’s Managing Price Risk I and Managing Price Risk II workshops. Along with HRC, iron ore and BUS trading. Andre also discusses the S&P 500, copper and crude […]
The following is a calculation used by Steel Market Update in order to analyze the spread between world hot rolled export prices and domestic (USA) hot rolled prices. SMU compares the world hot rolled export price using a range of adders for freight, handling, trader margin, etc. This is then compared to the spot (FOB […]
The Mexico Economy Secretariat announced an extension of the investigation of cold rolled coil from China. “There are enough elements to preliminary support that in the investigated period the imports of the subjected product were done under price discrimination and generated a harm threat to the national production,” said the secretariat on Monday. The products […]
Railroad traffic increased in November for both carload and intermodal volume. Class 1 freight railroads carried 1,161,820 carloads in November, up 1.4 percent year-over-year, according the American Association of Railroads. Intermodal traffic in increased by 2.7 percent with a weekly average volume of 258,765 containers and trailers for the month, the highest level in history […]
The supply of sheet products had strong positive growth in the 3 months period August through October year over year being up by 12.4 percent and led by hot band which was up by 16.1 percent (Table 1). The sources of this analysis are the Commerce Department trade statistics and AISI steel shipment data. These […]
In the first ten months of 2014, scrap exports totaled 12,905,000 metric tons, down by 17.6 percent from the same period in 2013. In the single month of October exports were 1,337,000 tons. Figure 1 shows that the three month moving average has been fairly consistent for the last six months through October and continued […]
I was advis ed today that Nucor had reduced their pricing on beams by $40 per ton in order to compete with foreign beam offers. The question then became what are the mills doing to blunt the impact of foreign steel offers of flat rolled products into the United States? As we reported on Tuesday, […]
For the past four days Steel Market Update (SMU) has been attending and speaking at the HARDI annual conference in San Antonio, Texas. One of the highlights of the conference were the presentations provided by Alan Beaulieu, one of the principal partners of the Institute for Trend Research (ITR) and the chief economist for HARDI. […]
Barge availability is still tight in the U.S. due to large cargo volumes of southbound grain, and northbound volumes of steel and salt, according to the Dec 4 MID-SHIP report. The US Department of Agriculture reports rates for southbound grain have dropped to 426 percent of tariff after reaching 800 percent or more in November. […]
Based on preliminary Chinese data, total steel exports from China were 9.7 million metric tons (10.7 million net tons) for the month of November, a 14 percent increase from the previous month and a 94 percent increase from November 2013 tonnage. This brings total 2014 exports to 83.6 million tons (92.2 million net tons). To […]
The Bureau of Labor Statistics (BLS) report on non-farm employment indicated that 321,000 jobs were added in November, October and September were revised up by a total of 44,000. The three month moving average (3MMA) of gains was the highest since May 2010 at 278,000. This job recovery is stronger than was the case in […]
Steel buyers in the November ISM Steel Buyers Survey are expecting general economic activity and sales and production to remain at current levels for the next six months. Eighty percent of buyers said general economic activity will remain the same while 90 percent expect the trend for sales and production in their industry to be […]
The following article on the hot rolled futures market comes to SMU from contributing writer Bradley Clark, Director of Steel Trading for Kataman Metals. Hot rolled coil futures have been quite inactive the past week due to the Thanksgiving holiday. As activity picks back up, it appears the next move will be lower. The forward […]
The Institute of Supply Management released their November report on December 2nd and after the October surprise on the upside, the index slid back slightly from 59.0 to 58.7. However, this is still the third best result of the year. Any number >50 indicates expansion and this was the eighteenth straight month for which this […]
Manufacturing expansion slowed around the globe in November. The JP Morgan Global Manufacturing PMI dropped to 51.8 indicating the slowest pace of growth in 15 months. New order growth posted a 16 month low as international trade languished. Commenting on the survey, David Hensley, Director of Global Economics Coordination at JPMorgan, said: “The global manufacturing […]
Steel Market Update (SMU) benchmark hot rolled coil pricing averaged $634 per ton ($31.70/cwt) for the month of November. CRU HRC averaged $635 per ton ($31.75/cwt) while Platts averaged $640 per ton ($32.00/cwt). Hot rolled prices at $630 per ton as of the last week of the month, were $5 per ton lower than where […]
The following is a “hypothetical” calculation of the spread between world hot rolled export prices and domestic (USA) hot rolled prices. SMU compares the world hot rolled export price with hypothetical adders for freight, handling, trader margin, etc. This is then compared to the spot (FOB Mill) domestic hot rolled price using the SMU Hot […]