NLMK USA’s sales fell 6.0 percent to 549,000 metric tons in the third quarter of 2019 compared to the second quarter, said NLMK Group in a trading update today. Declining volume was the result of decreased HRC sales due to lower demand from the tube and pipe sector. Shipments of hot-dipped galvanized (HDG) also decreased […]
Steel Market Update’s canvass of the market this past week reveals that many buyers are leaning pessimistic about their prospects for the fourth quarter. The majority responding to SMU’s questionnaire expect demand to continue weakening, prices to continue declining and growth to remain flat into the fourth quarter and possibly beyond. Demand SMU asked: At […]
U.S. Steel unrolled a new operating model on Tuesday that is expected to deliver $200 million of annual fixed cost savings by 2022. The new model includes a realignment of the company’s leadership team. The changes will be effective Jan. 1, 2020, and closely follow the recently announced investment in Big River Steel. “Our enhanced […]
Liberty Steel USA will get a new $25 million electric arc furnace at its Georgetown, S.C., rolling mill next year. Georgetown’s aging EAF has an annual capacity of 500,000 metric tons, but actual production has fallen far short of that amount. “We have a very efficient rolling mill at Georgetown and we now want to […]
Commerce Department Construction Put in Place (CPIP) data for August, released Oct. 1, shows total construction has had negative momentum every month since October last year. In the months June, July and August, total construction declined for the first time since November 2011, according to Steel Market Update’s analysis of the Commerce data. At SMU, […]
Job creation in September continued at a lackluster pace and the details signal a slowdown in steel consumption. In September, 7,000 jobs were created in construction, while manufacturing industries lost 2,000 jobs. About 114,000 jobs were created in the private sector, while government gained 22,000 positions. Table 1 breaks total employment down into service and […]
The rate of job creation in September slowed to 136,000, but the details of job cuts and job openings continue to be historically very positive, according to Steel Market Update’s analysis of the latest Bureau of Labor Statistics data. Net job creation in September declined to 136,000 from an upwardly revised 168,000 in […]
The Dodge Momentum Index gained 4.1 percent for a reading of 143.6 in September due to an increase in plans for commercial construction projects. The commercial component jumped 8.9 percent while the institutional component fell 4.8 percent. The Momentum Index, issued by Dodge Data & Analytics, is a monthly measure of the first report for […]
Construction employment continues to lag behind demand as a worker shortage continues. Construction employment grew in 252 out of 358 metro areas between August 2018 and August 2019, declined in 60 and was unchanged in 46, according to a new analysis of federal employment data released by the Associated General Contractors of America. A recent […]
SMU continues to pick up negative vibes through the analysis we currently are actively conducting on the flat rolled and plate steel markets. There is obviously something going on that is concerning buyers and sellers of steel. At the same time, one of the steel mills told me today that even though prices on their […]
The American Institute of Architect’s Architecture Billings Index (ABI) posted a score of 47.2 for August indicating a decline in planning activity for nonresidential construction. The national score for new design contracts was also below the neutral point of 50 at 47.9, a rare occurrence for the two scores. Having both indexes in contraction means […]
By CRU Principal Analyst James Campbell The decline of long product prices accelerated this month as demand in many regions around the world failed to ignite after the seasonally slow July-August period. Prices have now unwound to the level before the 2017-18 boom. Sluggish demand and falling scrap prices have turned sentiment bearish and buying […]
A new solar project in Pueblo, Colo., will bring the state one step closer to its goal of providing 100 percent carbon-free electricity by 2050 and give EVRAZ Rocky Mountain Steel predictable electricity prices through 2041. The 240-megawatt Bighorn Solar project will be built, owned and operated by Lightsource BP on property owned by EVRAZ […]
Our last issue sparked our readers to comment on a couple of topics. We addressed the Bayou Steel comments in another article in tonight’s issue. I will address the comments I received from U.S. Steel regarding their purchase of a portion of Big River Steel and the exposure to electrical steels (something I have never […]
U.S. Steel announced today it will acquire a 49.9 percent ownership interest in Big River Steel at a purchase price of $700 million with the intent to acquire the remaining shares within the next four years. U.S. Steel has committed financing to execute the transaction. The implied enterprise value of Big River is approximately $2.325 […]
Merchant bar producer Bayou Steel in LaPlace, La., closed its doors without warning on Sept. 30, putting 376 stunned employees out of work. A letter to parish and state workforce officials cited “unforeseen business circumstances” and a lack of financing as reasons for the closure. The plant operates an electric arc furnace turning scrap metal […]
The net situation changed little from August but the Treasury 10/2 yield spread became slightly positive on Sept. 27 and the SMU Steel Buyers Sentiment Index suffered a serious setback on Sept. 15. This report is designed to be a big picture summary of data on which we have reported in detail during the month. […]
The global manufacturing sector remains in contraction but is beginning to stabilize, says the latest report from J.P. Morgan and IHS Markit. The J.P. Morgan Global Manufacturing PMI rose for a second month in a row reaching 49.7, although still below the 50 neutral point. “The global manufacturing PMI sent a message of stability in […]
The third estimate of U.S. GDP growth in Q2 2019 at 2.01 percent was little changed from the first estimate. U.S. GDP is reported quarterly by the Bureau of Economic Analysis (BEA). There are three estimates. The first is released about 25 days after the end of the quarter and the second and third are […]
From June through August, global steel production increased by 3.1 percent, but excluding China, growth declined by 2.1 percent with the result that China’s share reached another all-time high of 55.9 percent. We have a new perspective this month on global capacity. About a year ago, the World Steel Association stopped reporting global capacity utilization […]
U.S. Steel announced today a joint venture partnership agreement under which it has taken the first step towards acquiring Big River Steel through the purchase of a 49.9 percent ownership interest at a purchase price of approximately $700 million in cash, with a call option to acquire the remaining 50.1 percent within the next four years. […]
Construction spending edged up 0.1 percent in August from July but declined from year-ago levels, with divergent trends in residential and nonresidential categories, according to an analysis by the Associated General Contractors of America of new federal spending data. Association officials said that many contractors in its recent survey report that staffing challenges are causing […]
Steel buyers report flat or declining demand and expect spot steel prices to test the lows reached earlier this year, according to the findings of Steel Market Update’s market trends questionnaire this past week. The consensus view of the economy is more uncertain. Demand Nearly half of steel buyers responding to SMU’s questionnaire reported declining […]
Mill lead times for most flat rolled steel products continue to see a slight shortening, according to the latest Steel Market Update data. Lead times for steel delivery are a measure of demand at the mill level. The shorter the lead time, the less busy the mills, and the more likely they are to discount […]
By CRU Principal Analyst Josh Spoores U.S. plate prices have fallen to a new cycle low and threaten to move lower. Prices here were assessed at $687 /s.ton, a $16 /s.ton fall w/w. This is now the lowest price recorded since early 2018. Price momentum of the plate market has taken a negative turn for […]
A workforce shortage continues to impede gains in construction employment, says the Associated General Contractors of America. Thirty-nine states added construction jobs between August 2018 and August 2019, while construction employment increased in 29 states from July to August, according to AGC’s latest analysis of Labor Department data. “Even more states probably would have posted […]
Steel Dynamics is expecting earnings to drop in the third quarter due to lower profits from its steel operations. Lower scrap prices were not enough to offset lower shipments and declining steel pricing. The steelmaker expects earnings in the range of $0.66 to $0.70 per diluted share compared to $0.87 per share in the second […]
Housing starts rebounded in August, jumping 12.3 percent from July and 6.6 percent from a year ago to a seasonally adjusted annual rate of 1,364,000. Multifamily construction surged 30.9 percent and single-family starts 4.4 percent from July. “Housing has been on an upswing in recent months as the pace of permits and starts has been […]
Existing home sales grew for the second consecutive month with three U.S. regions reporting higher gains, said the National Association of Realtors. Sales rose 1.3 percent from July to a seasonally adjusted annual rate of 5.49 million in August. Sales were up 2.6 percent from a year ago. Sales of single-family homes rose 2.9 percent […]
Demand for sheet products is declining due to the weakness in manufacturing. Construction expenditures are showing signs of softening and will reduce the demand for long products through the balance of 2019. This analysis by Steel Market Update is based on steel mill shipment data from the American Iron and Steel Institute (AISI) and import/export […]