Market Update | May 22, 2024

 

SALES OF EXISTING HOMES CONTINUED TO SLIDE IN APRIL

After declining in the previous three months, confidence among U.S. consumers rebounded in May. The May Consumer Confidence Index came in at 102.0, up from 97.5 in April. The present situation index increased to 143.1 from 140.6 in April. The expectations index, a short-term outlook, increased nearly 6.0 points to 74.6. Despite rebounding in May, the expectations index remains below 80 for the fourth consecutive month.

 

Input Costs

Zinc pricing continued to push higher this week, now up for the ninth consecutive week.

    • Zinc pricing came in at $1.41/lb this week, up from $1.40/lb previously and is at its highest level in sixteen months.

 

Spot iron ore pricing rebounded this week, climbing nearly $5/mt to $122/mt.

    • Rising inventories and low steel mill profitability in China, combined with weaker steel demand in 2024, have negatively impacted iron ore pricing since the start of the year.

 

Coking coal pricing was down this week on the back of stagnant demand.

    • The current coking coal pricing of $239/mt, is up 1.7% from last week but is down 0.4% from this time last month.

 

 

 

SUPPLY

U.S. raw steel production rebounded slightly last week, now up for the fourth consecutive week.

    • U.S. steelmakers produced 1.735 million tons at a 78.1% utilization rate.
      • Production was up 0.4% from the prior week but down 1.1% from the same week last year.
      • YTD production is down 2.7% from the same timeframe last year.

 

Total carbon steel imports in April continued to push higher, now up for the second consecutive month.

    • Preliminary April carbon steel imports totaled 2.055 million tons, up 4.1% from March and up 19.3% from 1.722 million tons in April 2023.
    • Carbon flat rolled imports continued to push higher in April, now up to its highest monthly total since March 2022.
    • Carbon flat rolled imports totaled 682,312 tons, up 2.7% from March and up 74.1% from April 2023.
      • While both hot rolled and coated sheet imports were down compared to March, a sharp increase in cold rolled sheet imports helped push the total higher.
    • Carbon flat rolled imports have now accounted for more than 50% of all imports for the fourth straight month.
      • Year-to-date carbon flat rolled imports are now up 43.2% compared to the same timeframe last year.

 

 

 

ECONOMIC

After declining in the previous three months, confidence among U.S. consumers rebounded in May.

    • The May Consumer Confidence Index came in at 102.0, up from 97.5 in April.
    • The present situation index increased to 143.1 from 140.6 in April.
    • The expectations index, a short-term outlook, increased nearly 6.0 points to 74.6.
      • Despite rebounding in May, the expectations index remains below 80 for the fourth consecutive month.
      • Continued readings below 80 is typically a threshold which usually signals a recession is ahead.
    • On a six-month moving average basis, purchasing plans for homes remained unchanged in May, staying at their lowest level since August 2012.
    • While still relatively depressed, buying plans for autos rose slightly for a second month, and buying plans for most big-ticket appliances increased for the first time in several months.

 

 

 

 

 

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.