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 […]
Steel Dynamics offered guidance on Tuesday saying it anticipates a better third quarter as compared to the second quarter due to increase in shipments and average metal spread (spread being the difference between steel costs and selling prices). In the sheet steel segment higher volumes and better spread increased profits, while in the long products […]
We noticed a little slippage in flat rolled steel prices over the past week. As one steel executive put it to SMU this afternoon, “Prices are in retreat – only at a snail’s pace.” One of our manufacturing sources told us that they had seen prices slip over the past two weeks, “We have seen […]
Austrian-based, Benteler International AG has begun construction of a division of Benteler Steel/Tube in Shreveport, LA. The $975 million steel manufacturing project will include a hot-rolling seamless tube facility to be completed in third quarter 2014 and an electric arc furnace in 2020. The facility will have a capacity of producing 320,000 tons of steel […]
The Empire State Manufacturing Index lost two points in September but conditions for New York manufacturers still indicate modest growth at 6.3. New orders picked up from a flat 0.27 in August, rising to 2.4. The shipping index surged 15 points to 16.4—its highest level in more than a year. Prices paid held […]
Both these data points are reported in the Federal Reserve G17 data base. The IP index (industrial production) was reported as 99.36 for August, up from 98.96 in July. This was an increase of 0.4 percent and moved the 3MMA up by 0.17 percent. Growth of the 3MMA was 2.0 percent year over year reversing […]
A group of construction industry trade associations have formed the Construction Industry Safety Coalition in response to a proposed OSHA rule on crystalline silica exposure. In an August 23 website posting, the Occupational Safety and Health Administration recommended a reduction of the permissible exposure limit for breathable silica. “Exposure to silica can be deadly, and […]
In light of the statistics shared earlier in this newsletter regarding South Korean shipments of hot dipped galvanized into the United States by port. We thought our readers would be interested in learning that South Korean steelmaker; Hyundai Steel is expanding their production capabilities (even with 700+ million metric tons of capacity in neighboring China). […]
Ohio Governor John Kasich spoke about regulation, education and economic development at the Association of Steel Distributors (ASD) meeting on September 12 at the Ritz Carlton, Cleveland. Governor Kasich said, “We believe that a regulatory environment is important. It is not like we don’t want any regulations, but we want common sense regulations.” As […]
Financial Markets Two weeks back we were 1640 on SP 500 and technically it looked like we were headed to 1550-1560 zone as part of a larger retracement. Well the market has dumbfounded the chartists again, and we have since rebounded to today’s level of 1682. We are likely headed now to the 1770-80 zone […]
Job creation at 169,000 in August was a little below expectations but the downward revision to June and July of 74,000 was very disappointing. Employment gains continue to be heavily slanted towards service industries. In August production industries added, 18,000 jobs, service industries added 151,000 jobs, (Table 1). Included in the service number is government […]
This past week, Steel Market Update (SMU) conducted our beginning of September steel market survey. Of those responding to last week’s survey 52 percent were manufacturing companies, 35 percent steel service centers and the balance were composed of steel mills (4 percent), trading companies (4 percent), toll processors (3 percent) and suppliers to the industry […]
The Global PMI composite index increased to 51.7 for the month of August, up from the 50.8 reading in July. This slight yet meaningful increase marks the eighth consecutive month of expansion in the manufacturing sector. Manufacturing production increased for the tenth consecutive month, with the rate of growth at the highest level recorded since […]
Sentiment Continues to Trend Higher (more optimistic) Steel Market Update (SMU) Steel Buyers Sentiment Index was measured earlier today at +40, down 3 points from the middle of August and well within the optimistic range for the index. Compared to one year ago buyers and sellers of flat rolled steel are feeling much better about […]
The Institute for Supply Management Purchasing Managers Index (PMI) registered 55.4 percent in July which was an increase of 4.5 percentage points above the June reading of 50.9. The 3 month moving average (3MMA) rose from 50.2 to 51.43. Any reading above 50.0 percent means manufacturing is expanding. JP Morgan Global Manufacturing & Services PMI […]