Economy
SMU's July At-a-Glance
Written by Brett Linton
July 30, 2021
Steel prices continued to climb through the month of July, now the 11th consecutive month prices have increased. Hot-rolled steel prices increased an average of $30 per ton ($1.50 per cwt) each week, with the SMU index averaging $1,860 per ton ($93 per cwt) as of last Tuesday. The SMU Price Momentum Indicator has remained unchanged since the August 2020 adjustment to higher, indicating prices are expected to rise further in the short term.
July scrap prices were flat to up $30 per ton over June, remaining at historically high levels. Click here to view and compare prices within our interactive pricing tool.
Zinc spot prices eased from the multi-year high seen last month, bouncing around $1.32-1.34 throughout July and surging to a 7-week high of $1.3727 as of July 30. Aluminum spot prices ended the month at a record-high of $1.1753 per pound. Excluding the occasional 2-5 day surges seen in aluminum spot prices, this is the highest daily price seen in over 10 years.
The SMU Buyers Sentiment Index remained highly optimistic throughout July, ending the month at +79. This reading is tied with the July 10 reading for the all-time high. Viewed as a three-month moving average, sentiment reached a record high of +75.83 in late-July.
Hot rolled lead times remained extended, reaching a high of 10.74 weeks in early July. The percentage of buyers reporting mills willing to negotiate on HR prices remained miniscule.
Key indicators of steel demand overall remained positive, as they have in recent months. The ISM Manufacturing Index indicated further expansion in the economy for the 13th consecutive month, and the AIA Billings Index, a measure of construction activity, recovered for the sixth month in a row. In the energy sector, the active drill rig count rose throughout the month, reaching a 15-month high. Total U.S. steel imports and apparent steel supply both have shown gains in recent months.
See the chart below for other key metrics in the month of July:
By Brett Linton, Brett@SteelMarketUpdate.com
Brett Linton
Read more from Brett LintonLatest in Economy
Architecture billings flat in October after months of contraction
Architecture firms reported stable billings in October, according to the latest Architecture Billings Index (ABI) released by the American Institute of Architects (AIA) and Deltek. This follows 20 months of contracting business conditions.
Trump taps Lutnick to be Commerce Secretary
President-elect Donald Trump has named Wall Street veteran Howard Lutnick as the new US Secretary of Commerce.
New York state manufacturing activity ramps up to multi-year high
New York state’s manufacturing sector saw substantial recovery in November, according to the latest Empire State Manufacturing Survey from the Federal Reserve Bank of New York.
CRU: Dollar and bond yields rise, metal prices fall as Trump wins election
Donald Trump has won the US presidential election. The Republican party has re-taken control of the Senate. Votes are still being counted in many tight congressional races. But based on results so far, the Republicans seem likely to maintain control of the House of Representatives. If confirmed, this will give Trump considerable scope to pass legislation pursuing his agenda. What this means for US policy is not immediately obvious. Trump will not be inaugurated until Jan. 20. In the coming weeks and months, he will begin to assemble his cabinet, which may give a clearer signal on his policy priorities and approaches. Based on statements he made during the presidential campaign, we have set out the likely direction of his economic policy here and green policy here.
ISM: Manufacturing index fell in Oct to lowest point of ’24
Domestic manufacturing contracted for the seventh straight month in October, according to the latest report from the Institute for Supply Management (ISM). This marks the 23rd time in the last 24 months that it has been in contraction.