Economy
SMU's August At-a-Glance
Written by Brett Linton
September 2, 2021
Steel prices continued to climb through the month of August, marking one full year of increasing prices. Hot rolled steel prices increased $45 per ton ($2.25 per cwt) throughout the month, with the SMU index averaging $1,935 per ton ($96.75 per cwt) as of Tuesday. The SMU Price Momentum Indicator remains unchanged since the August 2020 adjustment to higher, indicating prices are expected to rise further in the short term.
August scrap prices were flat to down $40 per ton from July, backing off of historically high levels. Click here to view and compare prices within our interactive pricing tool.
Zinc spot prices bounced between $1.33-1.38 per pound through August, nearing the multi-year high of $1.3883 seen in early-June. Aluminum spot prices soared higher throughout the month, ending at a record-high of $1.2357 per pound as of Aug. 31. 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 August, ending the month at record high +75 (technically recorded as a Sept. 1 reading). Viewed as a three-month moving average, buyer sentiment also reached a record high of +78.83.
Hot rolled lead times declined throughout August, ending the month at 9.79 weeks. The percentage of buyers reporting mills willing to negotiate on HR prices remains 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 14th consecutive month, and the AIA Billings Index, a measure of construction activity, recovered for the seventh month in a row. In the energy sector, the active drill rig count rose throughout the month, reaching a 16-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 August:
By Brett Linton, Brett@SteelMarketUpdate.com
Brett Linton
Read more from Brett LintonLatest in Economy
Fed indicators show continued stability in manufacturing
Recent Federal Reserve data indicates that the US manufacturing sector remains healthy and stable. The strength of the manufacturing economy has a direct relationship to the health of the steel industry.
January energy market update
In this Premium analysis we cover North American oil and natural gas prices, drilling rig activity, and crude oil stock levels. Trends in energy prices and active rig counts are leading demand indicators for oil country tubular goods (OCTG), line pipe and other steel products.
New York state manufacturing fell in January
“Price increases, while subdued, picked up,” Richard Deitz, Economic Research Advisor at the New York Fed. “Firms grew more optimistic that conditions would improve in the months ahead.”
Beige Book shows mixed economic trends, manufacturing challenges, tariff concerns
Economic activity across the US experienced slight to moderate growth at the end of 2024, while manufacturing activity showed a slight decline
Contractors concerned about tariffs, immigration in 2025: AGC survey
AGC said Trump should be “sparing” in imposing new tariffs and exclude products needed for domestic manufacturing, energy and infrastructure.