Shipping volumes from metals service center in the United States rose in 2017, with both steel and aluminium showing gains, according to the latest data from the Metals Service Center Institute (MSCI), released on Monday January 15.
US steel product shipments increased by 3.8%, or about 1.42 million tons, on an absolute basis to nearly 38.8 million tons last year, from 37.4 million tons in 2016.
Shipments rose by 2.8% year-on-year in December, although that modest rise was substantially below the 10.7% year-on-year gain recorded for October - the highest monthly figure of the year.
US distributors’ steel inventories stood at 7.71 million tons (2.9 months’ supply) in December, up by 6.8% from 7.22 million tons (2.8 months’ supply) in the corresponding month last year.
The data showed similar trends across aluminium products, and also in Canada, where the MSCI measures shipments of carbon steel products, excluding structural components, and aluminium, excluding extrusions.
Aluminum product shipments from US service centers jumped by 8.5% to 1.64 million tons in 2017 from just under 1.51 million tons the previous year.
Canadian steel product shipments rose by 2.7% year-on-year to 4.53 million tons. And while inventories dipped slightly to 1.13 million tons from 1.17 million tons, the supply on hand was stable at 4 months-worth.
But in a research note published on Tuesday January 16, analyst Seth Rosenfeld of investment bank Jefferies said that, in seasonally adjusted terms, December marked the best month of the year for US steel service centers, with shipments jumping by 7.8% from the previous year for 12 months of consecutive year-on-year gains.
Steel inventories remained lean, however, with the seasonally adjusted average in December slightly less than the post-2009 average of 2.5 months on hand.
US shipments of flat-rolled steel products rose by 8.4% year-on-year on a seasonally adjusted basis, while bar and structural products jumped by 19.1% and 10.7% respectively, according to data analyzed by Rosenfeld.
Lean inventories could support “steel producer pricing initiatives [in the] near term,” he wrote, adding that the recovery in steel demand appears to be broad due to robust demand across several products.
“December marks three months of robust growth rates in distributor shipments, and a full year of positive growth in 2017 following two years of contraction over 2015-16,” Rosenfeld wrote. “Recovering demand, coupled with low channel inventories and depressed imports, should bolster producers’ pricing power [in the] near term.”
source: metalbulletin |
