Steel Market News

  1. Service centers and manufacturing companies are telling Steel Market Update of softening demand, shortening lead times (may not be in the published numbers, but orders are coming out early), and negotiable pricing. Many buyers are sitting on their hands and only buying what they need. On top of this, SMU Service Center inventories appear to be balanced to slightly on the high side considering we are going into the slower side of the year, a traditional time to pare down inventories. The combination of these factors points toward lower spot prices on all flat rolled and plate steels over the next 30 days.

  2. Steel Market Update’s analysis of flat rolled and plate inventories and shipments, reported earlier this week to data providers and Premium subscribers, shows flat rolled inventories of 55.8 days of supply, and plate inventories of 52.1 days, as of the end of August. Service center flat rolled inventories remained elevated, while plate saw a reduction in supply last month to the lowest level seen all year.

  3. Raw steel production by domestic steelmakers declined for the third week in a row, taking the industry's average capability utilization rate down by another full percentage point to 77.8 percent. The last time the utilization rate was above 80 percent was the week of Aug. 24. Mill production has dipped by nearly 3 percentage points in the past month.

    Production for the week ending Sept. 14 totaled 1,811,000 net tons, down 1.3 percent from the previous week and down 2.9 percent compared with the same period last year, reported the American Iron and Steel Institute. 

  4. Nucor expects a weaker performance from its steel mills segment in the third quarter due to lower prices for sheet and plate steel.

  5. Editor's note: This story is still developing. Since this reporting, Saudi Arabian officials claim they have already restored 50 percent of their lost production and that they expect oil output to fully recover within weeks. On Tuesday, oil prices corrected back down by about 6 percent on the news that Saudi production would recover more quickly than anticipated. 

    By CRU Cost Economist Ross Cunningham

    A drone attack over the weekend on Saudi Arabia’s strategically exposed Abqaiq oil facility caused oil prices to skyrocket when markets opened this morning. Brent crude prices opened the day’s trading around $72/bbl—up more than 20 percent (the largest daily price move in almost three decades) as panic set in around the extent of damage. Saudi officials have confirmed that 5.7Mbbl/d of production has been impacted, equating to roughly half of their total production and 5 percent of world supply.