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 […]
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 […]
Nucor expects a weaker performance from its steel mills segment in the third quarter due to lower prices for sheet and plate steel. “Although we still see stability in most of the end-use markets that we serve, there has been some softening in automotive, agricultural products and power transmission markets,” said the company in guidance […]
Builder confidence hit a one-year high in September, according to the latest NAHB/Wells Fargo Housing Market Index. The HMI, which measures builder perceptions of current and future sales of new single-family homes, rose one point to 68. The HMI index gauging current sales conditions increased two points to 75 and the component measuring traffic of […]
By CRU Principal Analyst Chris Asgill The pervasiveness of steel market weakness came to the fore this month, particularly for steel long products, leading to a sharp drop in scrap prices in almost every market we assess. Consequently, the CRU metallics price indicator (CRUmpi) dropped by 8.3 percent m/m to 209.4 (see chart), the lowest level since November […]
“If you want to be successful in this business you need to understand the market you serve,” said Cleveland-Cliffs CEO Lourenco Goncalves at the Credit Suisse Basic Materials Conference on Tuesday. Goncalves appears to know what he is doing, having transformed Cleveland-Cliffs from a failing enterprise into a solid business with a unique market position. […]
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 […]
By CRU Senior Analyst Erik Hedborg Part two of our three-part series: What’s next for U.S. iron ore production? After a remarkably profitable 2018, the U.S. steel industry has suffered a setback in 2019 as steel prices have dropped sharply on weaker than expected demand. Steel margins have turned negative and production cuts have been […]
Planning activity for nonresidential construction declined in August, according to the latest report issued by Dodge Data & Analytics. The Dodge Momentum Index slid 1.3 percent to 127.8 last month primarily due to a 16.6 percent decline in the institutional component that offset a 9.1 percent gain in the commercial component. The index is a […]
By CRU Senior Analyst Erik Hedborg Part one of our three-part series: What’s next for U.S. iron ore production? The U.S. is blessed with a wealth of natural resources, including oil, gas, gold, copper, timber and coal. In addition, the country has large iron ore deposits that have supported its steel industry for more than […]
By CRU North America Analyst Ryan McKinley U.S. long product price declines were limited for most products in September after finding support from the scrap market, but downward pressure continues to mount. Even with scrap prices rising by $20 /l.ton in August, persistent price falls throughout the year have yet to spur buyers’ interest amid high […]
Employment gains fell short of expectations in August with only 130,000 new nonfarm jobs reported by the U.S. Census Bureau. Construction employment accounted for 14,000 jobs last month and 177,000 in the past 12 months, according to the latest analysis of government data by the Associated General Contractors of America. Ken Simonson, the association’s chief […]
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 […]
On Wednesday, September 4, 2019 the U.S. Department of Commerce issued a Preliminary Antidumping Duty Determinations on fabricated structural steel from Canada, China and Mexico. In the determination Canada was found to be essentially harmless while China and Mexico were found to be dumping fabricated steels into the U.S. markets. SMU normally does not cover […]
Construction spending was essentially flat in July, inching up less than 0.1 percent from June, according to an analysis of U.S. Census Bureau data by the Associated General Contractors of America. Spending slid 2.7 percent from a year ago to a total seasonally adjusted annual rate of $1.289 trillion. Year-to-date, spending declined by 2.1 percent […]
This report is designed to be a big picture summary of data we have reported in detail during the month. It summarizes 36 data streams that describe the state of the steel market and provide forward guidance for steel buyers and sellers. See the end of this piece for an explanation of the Key Indicators […]
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 […]
Construction Put in Place (CPIP) data released Sept. 3 by the Commerce Department shows the first decline in total construction in nearly eight years. Through July, total construction has had negative momentum every month since October last year, and in June and July total construction declined for the first time since November 2011, according to Steel […]
By CRU Principal Economist Lisa Morrison The last month has been interesting from a forecast standpoint given the reversal in the Fed’s monetary policy stance at the end of July, new developments in the U.S.-China trade war and a shift in currency policy in China. Through all this policy change, we continue to see a […]