Buyers & Sellers of Steel Less Optimistic about both Current & Future Business for their Company

In order to smooth out the numbers and take out some of the gyrations that can occur in any one reporting period, we use a three month moving average (3MMA). The 3MMA for our Current Sentiment Index is +37.17, 2.66 points lower than what we reported during the middle of November.  The last time our 3MMA was this low was in August 2013.

Future Sentiment Also Lower

SMU Future Sentiment Index, which looks at how buyers and sellers of steel feel about their company’s ability to be successful three to six months into the future, dropped 1 point to +46. The 3 month moving average also decline and is now at +46.83 which, like Current Sentiment above, is the least optimistic we have seen this index since August 2013.

What our Respondents are Saying:

A service center reported business conditions as being “poor” and told us during the process, “No immediate signs that things are going to change anytime soon.”

A manufacturing company located in Canada reported business conditions as being “fair” and told us, “Weather could/should be a factor over the next 3-4 months.”

Another service center reported business conditions as being “fair” and told us during the process, “Automotive demand good, all others fair.”

We had a number of manufacturing and distributors report weather and seasonal issues impacting their feelings about current and future market conditions.

About the SMU Steel Buyers Sentiment Index

SMU Steel Buyers Sentiment Index is a measurement of the current attitude of buyers and sellers of flat rolled steel products in North America regarding how they feel about their company’s opportunity for success in today’s market. It is a proprietary product developed by Steel Market Update for the North American steel industry.

Positive readings will run from +10  to +100 and the arrow will point to the right hand side of the meter located on the Home Page of our website indicating a positive or optimistic sentiment.

Negative readings will run from -10 to -100 and the arrow will point to the left hand side of the meter on our website indicating negative or pessimistic sentiment.

A reading of “0” (+/- 10) indicates a neutral sentiment (or slightly optimistic or pessimistic) which is most likely an indicator of a shift occurring in the marketplace.

Readings are developed through Steel Market Update market surveys which are conducted twice per month. We display the index reading on a meter on the Home Page of our website for all to enjoy.

Currently, we send invitations to participate in our survey to almost 600 North American companies. Our normal response rate is approximately 110-170 companies. Of those responding to this week’s survey, 40 percent were manufacturing and 44 percent were service centers/distributors. The balance of the respondents are made up of steel mills, trading companies and toll processors involved in the steel business.

Click here to view an interactive graphic of the SMU Steel Buyers Sentiment Index or the SMU Future Steel Buyers Sentiment Index.