Economy

SMU's July At-a-Glance

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:

July at a glance

By Brett Linton, Brett@SteelMarketUpdate.com

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.