Each week, Majestic Steel USA [majesticsteel.com], a steel service center that distributes prime, flat-rolled galvanized steel sheets and coils to industries across the United States, compiles the Core Report. The Report is “an in-depth look at key indicators and trends driving the steel market. Market volatility demands your attention about what’s driving prices, when and why.” Data sources are listed in each section.
Majestic Steel has granted Rollforming Magazine permission to publish information excerpted from the Report for its readers.
Domestic Steel Production
According to the American Iron & Steel Institute, Weekly Domestic Steel Production report dated August 13, U.S. mills produced an estimated 1,735k tons at a 78.1% utilization rate, which is up from 1,722k tons and a 77.8% rate previously. This was the highest tonnage output in nearly a month, however production remains in a tight window.
Production decreased in three of the five regions, but was offset by a large surge in the Southern region. Production from the Southern region rose from 733k tons to 752k tons. Year-to-date production remains up 1.3% compared to the same timeframe from 2023.
Recent Scrap Pricing
According to Prime Scrap Price, Market Conversations for the week ending August 16: After “hitting a floor” in July, prime scrap settled flat in August, suggesting a bottom has been set. Prime scrap settled at $380/gt for the third consecutive month. Weaker export activity, combined with a stronger push by the domestic mills, helped to overcome the reduced collection rates and increased finished steel price momentum, to keep pricing flat. Shredded scrap held steady at $375/gt.
Spot Iron Ore
The Platts, Spot Iron Ore report ending August 16, continued its sharp downward slide, now down ten out of the last eleven weeks. Spot iron ore pricing settled at $97.15/mt, down from $100.30/mt the week prior. This remains the lowest price for iron ore since early April and is down 30% since the beginning of the year. The world’s biggest steel producer in China warned about an industry crisis that could rival the downturns in 2008 and 2015. China’s July crude steel output fell by 9% from a year earlier to 82.94mt, with mills cutting out put due to government curbs and weak domestic demand.
Housing Market Index
According to the National Association of Homebuilders (NAHB), Housing Market Index from August 2024: Confidence among U.S. homebuilders remained muted in August and is at its lowest level since December. The August Housing Market Index came in at 39, down from 41 in July and down from 50 in August 2023. Any reading below 50 indicates increased pessimism from builders, while any reading above 50 indicates optimism.
Residential Construction
According to the U.S. Census Bureau, New Residential Construction: July 2024: New residential construction continued to decline in July, sliding to its lowest, non-pandemic related, monthly rate since July 2019. July new housing starts came in at 1.238 million unit rate, down 6.8% from June and down 16.0% from July 2023. New starts have now declined, on a year-over-year basis, for the third consecutive month and the fourth time in the last five months. The drop in July solely came from single-family units, which were down 14.1% from June.
Year-to-date actual new housing starts are now down 4.6% from the same timeframe last year. Permits, an indicator for future construction, declined as well, sliding 4.0% to a 1.396 million unit rate.
The full library of Core Reports from Majestic Steel USA can be accessed at https://www.majesticsteel.com/majestic-insights/core-report/. RF
