Market Update | February 12, 2025

 

KEY COMMERCIAL CONSTRUCTION INDICATOR INCREASED SHARPLY IN JANUARY

One of the leading indicators for future commercial construction spending, the Dodge Momentum Index, came in at 225.7 in January, up from an upwardly revised 213.6 reading in December. The index is up 23.3% from last January and is a new record high for the index. ​Planning increased for both commercial and institutional projects, climbing 4.2% and 8.7%, respectively. On the commercial side, data centers, office buildings, and warehouses led the increases. ​Education and healthcare projects led the way for institutional projects. ​The DMI is a leading indicator for nonresidential construction spending 9-12 months into the future.

 

PRICE

Domestic sheet pricing continued to push higher this week as all three product prices increased. Remember these prices were set by transactions from last week, before the new 25% tariff on steel was announced.

  • Improving demand, steadily declining sheet imports, and scrap prices increasing should help provide a boost to pricing through Q1 and into Q2.

 

Input Costs

Zinc pricing declined slightly this week, now down for the second time in the last three weeks.

  • Pricing came in at $1.28/lb this week, down from $1.33/lb last week.

Spot iron ore pricing slipped slightly this week after climbing the previous three weeks.

  • The current pricing, $112/mt, is down from $114/mt last week.

Coking coal pricing rebounded this week, improving to $189/mt up from $186/mt last week.

  • Prices are up 1.3% from last week but are still down 3.7% from this time last month.

 

SUPPLY

U.S. raw steel production increased again last week, now up for the second consecutive week.

    • U.S. steelmakers produced 1.675 million tons at a 75.2% utilization rate, up from 1.656 million tons previously.
    • Production was up 1.1% from last week but was down 2.0% from the same week last year.
  • YTD production is up 0.3% from the same timeframe last year.

 

A proclamation from President Trump this week reset the 25% tariffs on steel imports from all counties.

  • The flat 25% tariff will be without exceptions or exemptions and eliminate any quota deals.
  • All granted exclusions will remain valid until either expiration date or full utilization of the excluded volume.
    • This new measure will take effect on March 12th.
  • The proclamation also extends tariffs to downstream products that use foreign-made steel and require all steel products to be made from steel that is “melted and poured”in the region.

 

DEMAND

​​One of the key leading indicators for future commercial construction spending increased sharply to start off 2025.

  • The January Dodge Momentum Index came in at 225.7, up from an upwardly revised 213.6 reading in December.
    • The index is up 23.3% from last January and is a new record high for the index.
  • ​Planning increased for both commercial and institutional projects, climbing 4.2% and 8.7%, respectively.
    • On the commercial side, data centers, office buildings, and warehouses led the increases.
    • Education and healthcare projects led the way for institutional projects.
  • ​The DMI is a leading indicator for nonresidential construction​ spending 9-12 months into the future.

 

Domestic carbon flat rolled consumption rebounded in December, climbing to a 140.5k ton/day rate.

  • This is up 3.9% from November but down 2.1% compared to the 143.6k ton/day rate in December 2023.
    • For the full year 2024, carbon flat rolled consumption totaled 53.3 million tons, the highest annual rate since 2021.

 

ECONOMIC 

Prices paid by U.S. consumers increased 0.5% in January on an annual basis after seeing a 0.4% increase in December.

    • Over the last twelve months, prices for all items increased 3.0%.
  • ​CORE prices, which excludes the volatile food and energy sectors, increased 0.4% in January, a sharper increase than the 0.2% increase in December.
  • ​Over the last twelve months, prices were up 3.3% .
  • The shelter index increased 4.4% over the last year, the smallest 12-month increase in three years.
    • Other indexes with increases over the last year were motor vehicle insurance (+11.8%), medical care (+2.6%), education (+3.8%), and recreation (+1.6%).
  • ​​On a m/m basis, the only sector to see a decline in prices was apparel, which declined 1.4%.

 

 

This material, information and analyses (the “Content”) may include certain statements, estimates and projections prepared with respect to, among other things, historical data and anticipated performance.  Content may reflect various assumptions by Majestic Steel USA, Inc. concerning anticipated results that are inherently subject to significant economic, competitive and other uncertainties and contingencies and have been included for illustrative purposes. Content is provided AS-IS.