SMU Market Trends: Mixed Reaction to Infrastructure Bill

Most survey respondents agree the biggest impact will not be felt among producers and distributors of sheet products. Long products, such as rebar, as well as plate and beams, are expected to see the greatest benefit. Any real boost to the steel market is probably a few years away, they said, after projects are planned and bid – assuming the House and Senate can even agree on new funding.

Here’s What Some of Them Had to Say:

“Without a doubt, it’ll be a nice boon. Obviously, for some sectors more than others. But anyone tied into construction equipment or rental companies will have a very fun run.”

“It certainly won’t hurt the market.”

“This will be more help to structural products than flat rolled.”

“Most impact will be seen for long products, which have been running at well under mill capacity levels.”

“Planning for this will take years, and governments – state and federal – don’t move fast. Engineers alone will take many months to plan and get approved way before implementation.”

“It will only kick-in in earnest in three years’ time. If infrastructure focuses heavily on renewables, such as solar, that could be a positive for flat rolled.”

“Most of the new demand will be for plate or shapes, and there is plenty of capacity to handle that. Flat-rolled will be minimal. And there will be no impact until 2023 when most of it is needed.”

“There’s quite a bit of apprehension among long products mills regarding potential infrastructure-related demand, but it doesn’t seem to be impacting flat products mills at this time.”

“Obviously steel shortages will continue if this package passes.”

“The reported 3% increase in steel demand from the infrastructure package does not seem significant to me.”

“Actually, I don’t think it will pass the House.”

“Not sure if it will ever get through Congress. We’ll cross that bridge (no pun intended) when we get to it.”

By Tim Triplett, Tim@SteelMarketUpdate.com