SMU Data and Models
SMU MoMo Index Increasing with Higher Prices
Written by Brett Linton
October 23, 2013
The Steel Market Update Price MoMo Index for flat rolled steel in the U.S. remained positive this week for the 2nd week in a row after 4 consecutive weeks of being in negative territory. MoMo, a trailing indicator, is based upon the current hot rolled coil price weighed against the previous 12-week average spot price as recorded by Steel Market Update. MoMo was measured at 2.29 percent this week, meaning that the current HRC price is above the average price from the previous 12 weeks.
The change in MoMo can be a useful indicator in depicting the severity of price movements. Looking at this change on a 3-week moving average, we see that the trend in HRC price fluctuation has began to rise after being relatively flat for the past few weeks. The 3-week average change in MoMo is 1.15 percent, meaning that the change in HRC prices over the previous 12 weeks has been is becoming moderate.
The graph below demonstrates the relationship between the SMU hot rolled coil price and the three week moving average change in MoMo. Our HRC price range for this week is $640-$680/ton with an average price of $660/ton.
Brett Linton
Read more from Brett LintonLatest in SMU Data and Models
SMU’s December at a glance
SMU’s Monthly Review provides a summary of important steel market metrics for the previous month. Our latest report includes data updated through December 31st.
SMU Survey: Steel Buyers’ Sentiment Indices contrast at year end
Both of our Sentiment Indices remain in positive territory and indicate that steel buyers are optimistic about the success of their businesses.
SMU Survey: Mill lead times contract slightly, remain short
Steel mill production times have seen very little change since September, according to buyers participating in our latest market survey.
SMU Survey: Buyers report mills are slightly less flexible on pricing
Steel buyers of sheet and plate products say mills are still willing to bend on spot pricing this week, though not quite as much as they were two weeks prior, according to our most recent survey data.
December energy market update
Trends in energy prices and active rig counts are leading demand indicators for oil country tubular goods (OCTG), line pipe and other steel products