In our recent steel market survey which we conducted this past week, 56.4 percent of those responding to our questions (all respondents) told us the current contract negotiations on their 2014 flat rolled steel needs represented a “game changer” for the U.S. steel industry. Manufacturers We asked manufacturing companies if their contract negotiations included reduction […]
Based on responses from the Steel Market Update (SMU) mid-October steel market survey, SMU Steel Buyers Sentiment Index is +38 and is considered to represent an optimistic view of the industry by those buying and selling flat rolled steel products. The latest reading is up one point over our early October measurement but is one […]
Automotive production, sales and inventory in NAFTA through September 2013 Based on Ward’s automotive reports, total light vehicle, (LV) production was 1,390,175 units in September, down by 3.3 percent from August. Autos were down by 5.1 percent and light trucks by 1.8 percent. A better measure of direction is the three month rolling average of […]
Steel Market Update saw a letter from Majestic Steel to their customers publically announcing a price increase. Majestic, which is well known as a supplier of coated products to the HVAC and construction industries, told their customers that the price increase is due to cold rolled base prices reaching as high as $39.50/cwt and $40.50/cwt […]
Business conditions held steady for New York manufacturers according to the October Empire State Manufacturing Index. The general business index fell 5 points to 1.5 but remained in growth status. The new orders index rose 5 points while shipping fell 3 points, suggesting modest increases for both indexes for the month. The prices paid index […]
There is a lot going on regarding contracts, contract negotiations and the timing of when orders/commitments need to be placed with the domestic steel mills. SMU has had direct conversations and seen email correspondence which suggests at least one of the integrated steel mills is pushing for remaining 2013 tonnage to be placed right away […]
Gov. Robert Bentley of Alabama announced that IT-TRI LLC will build a steel tubing and manufacturing plant in Lawrence County. The Chicago-based company hopes to break ground in Trinity, Ala. this fall and begin operations in 2014. “Having two raw material suppliers in Alabama, Nucor Steel in Decatur and U.S. Steel in Birmingham, and due […]
Steel buyers surveyed in the September Institute for Supply Management’s Steel Buyer’s Forum are expecting orders to remain flat or drop in the next three months. Buyers who felt orders would remain the same increased to 53.3 percent from 41.2 percent in August; those who predicted a drop increased to 20 percent from 11.8 percent […]
CHARLOTTE, N.C., Oct. 7, 2013 — Nucor Corporation NUE +0.08% announced that The Steel Manufacturers Association (SMA) presented Nucor’s Executive Chairman Dan DiMicco with its Iverson-Selig award, recognizing his outstanding contributions to the minimill steel industry. The award is named after Nucor’s founder Ken Iverson and Marvin Selig, founder of CMC Steel, who were two […]
The partial federal government shutdown prevented the Bureau of Labor Statistics from publishing the September data which was scheduled for last Friday. We have therefore decided to take a more in depth look at manufacturing and construction employment through August. The graph below shows the change in total employment for these two sectors since January […]
During the past few surveys, Steel Market Update has been asking if the additional tonnage being brought on-stream by U.S. Steel (Lake Erie), ThyssenKrupp Steel USA (building back slab inventory) and AK Steel would cause an imbalance in supply-demand ratios. Almost everyone within the industry has been of the opinion that the extra supply would […]
Effect of the government shutdown on information flow: about half of the data that we at SMU use to evaluate the state of and direction of the steel market is produced by government agencies and is publicly available. The current nature of things was brought home to us on Tuesday when we attempted to access […]
For the past three days, Steel Market Update has been canvassing those attending the Metalcon show in downtown Atlanta. We spoke with manufacturers associated with the metal building, architectural panel and various construction products as well as their service center, steel mill, trading company, paint and toll processors. We heard mixed results regarding 2013 versus […]
In spite of the federal government’s decision to shut down, those involved in the flat rolled steel industry continue to remain optimistic about their company’s ability to be successful in both the current environment as well as 3-6 months into the future. Steel Market Update (SMU) just completed our beginning of October flat rolled steel […]
The Institute of Supply Management Purchasing Managers Index, (PMI) registered 56.2 percent in September, an increase of 0.5 percentage point from the August reading. The 3MMA (three month moving average) of the index was 55.7 in September, the highest in over two years and continued to distance itself from the 50 threshold that marks the […]
The Chicago Fed Midwest Manufacturing Index (CFMMI) is a monthly estimate by major industry of manufacturing output in the Seventh Federal Reserve District states of Illinois, Indiana, Iowa, Michigan and Wisconsin. It is a composite index of 15 manufacturing industries that uses hours worked data to measure monthly changes in regional activity. The official news […]
Steel Market Update (SMU) has received a large number of comments and inquiries regarding the subject of contract negotiations between the domestic steel mills and their end user and service center customers. Here are some samples: “I think the bucket deals are gone and the 6 percent deals are gone. I think the mills are […]
Manufacturing activity in the Tenth District slowed in September according to a survey by the Federal Reserve Bank of Kansas City. The month-over-month composite index that factors in production, new orders, employment, supplier delivery times, and raw materials inventory indices, was 2, dropping from 8 in August and 6 in July. The production index slid […]
“I am shocked” was how one manufacturing purchasing manager put it to SMU in a conversation regarding the replacement of Tom Marchak as head of Commercial for Severstal North America. On Tuesday, Severstal North America introduced Sachin Shivaram as the new Vice President, Commercial for the mill. This change comes three weeks after the […]
The shipping industry is set for a profitable year for the first time since 2010 according to the September 25 MID-SHIP Report. Freight rates are continuing to rise and demand for large size ships is finally beginning to outpace supply. The industry has faced a supply glut partially due to shipyards offering vessels at low […]
One of our service center contacts told Steel Market Update recently, “The ending of indexed pricing for many is just around the corner which is a major positive but hearing little of this from SMU. [The] mills still trying to make something – they cannot continue to withstand the losses they have incurred. In fact, […]
Manufacturing activity in the Fifth District was stalled in September according to the Federal Reserve Bank of Richmond. The composite index of manufacturing activity registered 0 following last month’s reading of 14. New orders and shipments slowed compared to August. Lead times were unchanged at an index reading of 1 for the second month. Shipments […]
U.S. steel industry members are challenging proposed changes to Federal Highway Administration (FHWA) Buy America laws that will affect manufactured products, ferry boat equipment, and pig iron and processed, pelletized, and reduced iron ores. The FHWA sought comments from the public regarding the continued, need, in whole or part for the general waivers on […]
An explanation of the Key Indicators concept is given at the end of this piece for those readers who are unfamiliar with it. The total number of indicators considered at present is thirty six. The present situation of eleven of the indicators based on historical standards was positive on September 22nd and thirteen were negative; […]
A majority of the manufacturing companies (57 percent) responding to our most recent steel market survey told us that the spread between foreign and domestic steel is wide enough to justify buying foreign steel. The percentage of manufacturing companies answering this way has increased by 3 percent compared to our results from 30 days ago. […]
We heard it earlier this month when during our HARDI steel conference call the wholesalers complained of reduced margins due to competitive pressures and mentioned that there were a growing number of non-traditional galvanized suppliers competing for the mechanical contractors business. During last week’s steel market review conducted by Steel Market Update (SMU), manufacturing companies […]
In August China’s steel production exceeded 50 percent of the global total for what we believe to be the first time. Global production in August was 130.352 million tonnes with a capacity utilization of 76.0 percent. In three months through August production was at an annual rate of 1.572 billion tonnes with a capacity utilization […]
SMU found lead times essentially remaining the same on hot rolled (negligible change from 4.0 weeks to 3.97 weeks) and galvanized (6.0 weeks vs. prior 6.07 weeks). Cold rolled lead times dropped from 6.2 weeks to 6.06 weeks while Galvalume lead times moved out slightly from 6.55 weeks to 6.80 weeks. Lead times are […]
Steel Market Update conducted our mid-September flat rolled steel market survey this week. The survey began on Monday with an invitation to approximately 600 companies who are active participants in the flat rolled steel industry. Part of the survey includes questions regarding attitudes within the industry regarding how successful the respondents see their company both […]
Good news from the Philadelphia Federal Reserve Bank—manufacturing activity increased from 9.3 to 22.3 in September, its highest reading in the Business Outlook Survey since March 2011. Demand for manufactured goods increased 16 points on the new order index to 21.2. Shipments picked up from a decrease last month. Inventories and deliveries were steady […]