Benchmark hot rolled coil prices dropped again this week as buyers struggled with an oversupplied HRC market due to high service center inventories, a continuation of high foreign imports and the collapse of the OCTG and line pipe markets due to weak oil prices. Couple those three items with more domestic supply than necessary for […]
The Metal Service Center Institute (MSCI) reported steel distributor shipments and inventories on Monday. The MSCI reported U.S. shipments of all steel products totaled 3,135,700 tons during the month of December which was 6.3 percent higher than December 2013. The daily shipment rate was 142,500 tons per day. Total steel inventories (all products) were reported […]
A lot has already been written about the dramatic decline in oil prices, the persistent high imports of energy tubulars, and related issues. What is missing, in my opinion, is some perspective and context to pull it all together. The purpose of this article is to show why the energy sector is so important to […]
Gulf ports are not experiencing the horrific congestion issues seen in the West. Fleetwood Port Logistics, out of Houston and Savannah, that deals primarily in break bulk steel products, has seen little to no congestion at the primary discharge terminal of North City Docks, Port of Houston. There has been some congestion at the smaller […]
The U.S. Department of Commerce updated its import license data earlier today. January import levels continue to be at very high levels compared to November and December and very similar to what we saw in September when imports totaled 3.9 million net tons. The daily rate is about 10,000 tons per day higher than November […]
EVRAZ North America produced 1.999 million tonnes (2.2 million net tons) of crude steel in 2014, down 8.8 percent from the total in 2013. Crude steel production increased by 5.7 percent to 528,000 tonnes (582,000 tons) in the final quarter of 2014 as compared to third quarter 2014. Finished steel products slipped 8 percent y/y […]
The following article is a continuation of our Steel Buyers Basics series written by Mario Briccetti. Mario is Principal of Briccetti & Associates, a Supply Chain consulting firm, and can be reached at Mario@mbriccetti.com. Briccetti wrote the following article as part of our Steel Buyers Basics series of articles, many of which can be found […]
Below is the latest data issued by the the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) regarding residential and commercial heating and cooling equipment shipments through October 2014. You may read the press release on their website here. Residential Storage Water Heaters U.S. shipments of residential gas storage water heaters for November 2014 increased 3.9 percent, […]
According to Baker Hughes data from January 16th, 2015, the U.S rig count for this week is 1,676 rigs exploring for or developing oil or natural gas. This count is a decrease of 74 rigs when compared to last week, with oil rigs down 55 to 1,366 rigs, gas rigs down 19 to 310 rigs, […]
Each quarter ITR Economics and HARDI offer a forecast on the construction industry. Steel Market Update provides a summary of that forecast on a national and regional basis. This week we are going to change our format slightly and provide the national forecast summary based on ITR’s Interactive Regional Economic Forecast Webinar. We will provide […]
A paradigm shift seems to be underway in the HRC futures market now that prices have broken through the critical support level of $600. The CRU is now at $584, which is down over 10 percent from around $665 just three months ago. With futures contracts trading at $580 per ton for the first half […]
Figure 1 shows historical gas and oil prices since January 2000. The daily spot price of West Texas Intermediate fell below $100 in August and by January 12th was down to $46.06, the latest daily figure available from the Energy Information Administration (EIA). Brent closed at $46.90 on the same day. There is no sign […]
The U.S. Department of Commerce updated the import license data earlier this afternoon. Based on data collected through January 13, 2015, import licenses are lower at this point in the month than what we saw in September, October, November and December. Licenses for all steel products totaled 100,264 net tons which is much lower than […]
The Bureau of Labor Statistics (BLS) report on non-farm employment indicated that 252,000 jobs were added in December, November and October were revised up by a total of 50,000. The three month moving average (3MMA) of gains in December was second only to November as the highest since May 2010 at 289,000. This job recovery […]
As we reported last week, the $30 per ton ferrous scrap price increases failed to materialize once January negotiations began in earnest. A couple lucky deals were made up $20-$30 just as December ended and January began. However, those deals dried up almost as fast as the ink dried on the paper. We are hearing […]
Steel Market Update received an email late last week that spoke to the problems the domestic steel mills are facing right now: a weak global steel market, strong dollar, all U.S. production facilities up and running, growing steel inventories, low in-put costs and a collapse in demand from the energy sector. We thought our readers […]
Low oil prices and the proliferation of pipe and tube imports at below market prices are causing manufacturers to idle mills and lay off workers. The latest round of layoffs comes from Tenaris which announced it will lay off 500 employees in Conroe, Texas and in Blytheville, Arkansas. “The energy industry’s present circumstances have driven […]
According to Baker Hughes data from January 9th, 2015, the U.S rig count for this week is 1,750 rigs exploring for or developing oil or natural gas. This count is a decrease of 61 rigs when compared to last week, with oil rigs down 61 to 1,421 rigs, gas rigs up 1 to 329 rigs, […]
I thought the “Letter to the Editor” which we shared earlier in this issue was quite telling. The New Year is shaping up to be different than the past couple of years. With the drop in input costs and the weak global steel market (and strong U.S. dollar) 2015 could end up being a very […]
The first measurement of our Steel Buyers Sentiment Index in the New Year provided us some mixed results. Current Sentiment, which is how steel buyers and sellers feel about their company’s ability to be successful in the current market environment, was measured at +54. This is well within the optimistic range of our Index but […]
Ferrous scrap prices were forecast to be up $30 per gross ton as little as one week ago. According to one of our East Coast dealers there were some early sales at up $20 to $30 to those steel mills who needed to buy immediately. However, those deals were few and far between and the […]
Commercial Metals Company (CMC) reported net sales of $1.7 billion for the first quarter of FY 2015, a four percent increase year-over-year. Earnings from continuing operations totaled $38.3 million. Americas Recycling recorded an adjusted operating loss of $1.1 million due to a decline in ferrous scrap shipments and margins. The America Mills segment recorded adjusted […]
US Steel announced Monday it will idle its US Steel Tubular Operations in Lorain, Ohio. In a letter to employees, US Steel said the layoffs are a “result of a decline in tubular market conditions, which is impacting demand for the plant’s products.” Layoffs affecting 614 employees will begin around March 8 and continue through […]
The value of the U.S. dollar is having a major impact on commodity, scrap and steel pricing. The strengthening of the dollar is something that Steel Market Update is watching very closely. We are therefor going to increase the number of times we provide currency updates from once per month to every three weeks (and […]
Manufacturing growth across the globe slowed as 2014 drew to a conclusion. The December JP Morgan Global Manufacturing Purchasing Managers Index (PMI) registered 51.6 in December, down from 51.8 the previous month and its lowest level since August 2013. North America remained the primary driver of manufacturing growth for the world as the Eurozone and […]
We provided full year projected steel imports in tonight’s issue. Please be aware: 1) the November numbers are Preliminary Census and should be very close to accurate, 2) the December numbers are based on license data and there can be fluctuations in the Census and license data numbers. November is a good example. November license […]
The following is an overview of some of the key steel data collected by Steel Market Update during the month of December 2014. This is separate from our Key Market Indicators which was produced for our Premium level subscribers (although shared with all of our readers on Friday of this past week). Steel Market Update […]
Everyone wants to know how the steel industry did from our perspective over the calendar year 2014. We decided to take a look at the year using quarterly averages as a way of smoothing out the data and giving us a clearer picture of key data and commodity and steel pricing trends. As you can […]
The ISM Manufacturing Index retreated again in December. The Institute of Supply Management released their December report on January 2nd and after the October surprise on the upside, the index slid back once again from 59.0 to 58.7 in November and to 55.5 in December, however this is still equal to the average for the […]
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 in this analysis is currently 36. Please refer to Table 1 for the view of the present situation and the quantitative measure of trends. Readers […]