SMU's April at a Glance

Zinc spot prices climbed to record highs this month, then began to ease. The Kitco spot price for zinc was $1.97 per pound on April 1, reaching a high of $2.05 per pound on the 19th, and ending the month at $1.89 per pound. Aluminum prices continue to decline from March highs, moving from $1.66 per pound at the beginning of the month to $1.46 per pound on April 29.

The SMU Buyers Sentiment Index remains high, with optimism ranging from +78 to +82 last month. Viewed as a three-month moving average, buyers’ sentiment rose to +76 as of the end of the month, a level not seen since late 2021. Future sentiment readings also remain optimistic, as they have been for over a year and a half.

Hot rolled lead times peaked in mid-April at 5.8 weeks (levels last seen in November 2021), declining to 5.3 weeks by the end of the month. Recall lead times were relatively stable prior to March, hovering around 4 weeks in January and February. The percentage of buyers reporting that mills are willing to negotiate on hot-rolled coil prices grew throughout the month. Late April data indicates over half of mills are now willing to talk price to secure an order, up from 20% in early April. A history of HRC lead times can been seen within our interactive pricing tool.

Key indicators of steel demand are positive overall. The AIA Billings Index indicated that construction activity remains strong, and the energy and automotive sectors continue to improve. Total US apparent steel supply fell to 8.4 million tons in February, down considerably compared to the prior 9 months but still strong historically. We continue to see healthy construction spending levels throughout the latest data.

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

By Brett Linton, Brett@SteelMarketUpdate.com