Economy

SMU's December At-a-Glance

Written by Brett Linton

January 4, 2020

The industry finished 2019 with steel prices on the rebound. Steel Market Update’s Steel Pricing Momentum Indicator pointed upward in December as the mills worked to collect higher prices announced in four waves beginning in late October. The benchmark price for hot rolled steel rose to more than $570 per ton by the end of December from less than $500 at the beginning of the fourth quarter, supported by rising scrap prices. Producers and distributors are hopeful the trend will continue into January.

Higher prices and prospects for better margins improved steel buyers’ sentiment in the fourth quarter, but readings in the 40-50 range in December remained well short of the more optimistic levels of a year ago. Concerns about steel demand weighed on market sentiment last month. Key indicators, such as the ISM Manufacturing Index, which was in contraction at less than 50.0, and the U.S. rig count, which continued to trend downward in December, raise questions about the health of steel consumption in 2020.

See the chart below for other key metrics in the month of December:

Brett Linton

Brett Linton is a senior analyst for Steel Market Update, where he began his career. Linton has been in the steel industry since 2010. He has held roles as a category manager and strategic insights director at Reibus before returning to SMU in 2024. He is a graduate of The University of North Georgia with a degree in Finance and Accounting. Brett can be reached at brett@steelmarketupdate.com or 724-314-0179.

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