SMU Survey: Current Steel Buyers' Sentiment slips to multi-year low

Key takeaways

SMU’s Current Sentiment Index suggests buyers are still optimistic about their businesses’ ability to succeed in today’s market, though their confidence has significantly declined compared to recent months. In contrast, our Future Sentiment Index indicates buyers are optimistic about favorable business conditions in the new year.

Current Sentiment

SMU’s Current Buyers’ Sentiment Index declined nine points to +30 this week (Figure 1). This marks the lowest level recorded since May 2020, surpassing the lows we saw earlier this year in July (+34). This time last year Current Sentiment was significantly stronger at +64.

Year to date (YTD), Current Sentiment has averaged +50 over the first 10 months of 2024. This is considerably lower than the same time frame of 2023 when it had averaged +67.

Future Sentiment

SMU’s Future Buyers’ Sentiment Index rose one point to +71 this week, the second-highest reading this year (Figure 2). Recall that in early August, Future Sentiment dipped to +55, its lowest level in over a year, before quickly recovering to a nine-month high of +72 just two weeks later.

Since the beginning of this year, Future Sentiment has averaged +65. This is down two points from the same period last year. This time one year ago, Future Sentiment stood at +74.

What SMU survey respondents had to say:

“When the election is in the rearview mirror, we believe most industries will return to business as normal in 2025.”

“We have new products in the pipeline that will be fully launched by year-end.”

“Falling interest rates and rising steel prices should help our industry improve.”

“The election will open up more work.”

“We are working to position ourselves for the future.”

“Restrictions on trade, specifically on CORE, will make 2025 a more challenging year for imports.”

Moving averages

When analyzed as a three-month moving average, Steel Buyers’ Sentiment also moved in alternate directions this week, as shown in Figure 3.

As of Oct. 23, the Current Sentiment 3MMA eased to +40.32, just above the four-year low of +39.20 recorded in mid-September. Over the past nine months, the Current Buyers’ Sentiment 3MMA has generally trended downward. The Future Sentiment 3MMA rose to a five-month high of +66.15 this week, recovering from the one-year low observed in early September.

About the SMU Steel Buyers’ Sentiment Index

The SMU Steel Buyers Sentiment Index measures the attitude of buyers and sellers of flat-rolled steel products in North America. It is a proprietary product developed by Steel Market Update for the North American steel industry. Tracking steel buyers’ sentiment is helpful in predicting their future behavior. A link to our methodology is here. If you would like to participate in our survey, please contact us at info@steelmarketupdate.com.