U.S. service center total carbon steel shipments increased by 17.0% month on month (m/m), however, August had four more shipping days than July. On a tons per day basis, August came in at 143.1, 1.8% higher than July. On a year to date, (YTD) metric, total carbon steel shipments increased by 3.1%.
Table 1 shows percentage change results for shipments, daily intake and inventory level. In all cases the percentage change references 3MMA year on year (y/y). For shipments and inventory, three columns of data are listed offering 12, 24 and 36 month changes.
All products groups except pipe & tube and sheet posted year on year increases in shipments. Bar & shapes recorded the strongest growth y/y, up 16.7% 3MMA y/y. August plate shipments were up 6.4% 3MMA y/y. Structurals 3MMA y/y shipments grew by 6.9%. Sheet deliveries fell slightly, off 0.3%, 3MMA y/y. Pipe & tube posted a decline of 4.5% 3MMA y/y. Even though overall shipments have rebounded thus far in 2017, shipments were 5.0% lower YTD than two years ago.
Bar and shapes shipments had a strong month helped by a 50.0%, 3MMA y/y surge in alloy bar shipments, a 23.2%, 3MMA y/y bump for cold finished and a 7.4% increase in special bar quality, (SBQ). Merchant bars shipments pulled the average down, falling 13.8%, 3MMA y/y.
The overall inventory levels months on hand (MOH), was 2.25 in August, low by historic standards, (24 month average from 2013 to 2016 = 2.44 MOH). This indicates that intake should increase going forward to support the stronger shipment levels. In fact, on a 3MMA basis daily intake did increase for most product groups. For all product groups, intake increased by 3.4% y/y. Bar & shapes intake ramped-up by 28.4% y/y, plate +3.9% y/y, structural shapes, + 0.3% y/y. Pipe and tube intake was up 2.9% y/y, while sheet intake increased by 0.3% YTD y/y.
Overall inventory levels fell by 2.6%, 3MMA y/y, as pipe & tube tumbled 9.5% y/y, sheet was off 5.3% and structural inventory fell by 1.7% y/y. Inventory surged by 13.4% y/y for bar & shapes and was higher by 0.3% y/y for plate.
Bar & shapes MOH was 2.32, -0.42 points m/m. Sheet’s MOH was 2.05, -0.29 points m/m. Plate’s MOH was 2.79, -0.41 point m/m. Pipe & tube MOH was 2.33, -0.44 m/m. Structurals MOH recorded a level of 2.49, flat m/m.
At Gerdau we scrutinize the MSCI release every month searching for clues on the industry’s performance. It’s important to us as a significant supplier of long steel products to our service center customers. It’s equally important to keep our steel consuming consumers informed.