Market Update | April 26, 2023
NEW HOME SALES REBOUNDED IN MARCH
March new home sales came in at a 683,000 unit rate, up 9.6% from February but still down 3.4% from a 707,000 unit rate in March 2022. Q1 actual sales are up nearly 40% from total sales in Q4 2022. Despite the pick up in sales, the amount of homes for sale at the end of the month was flat compared to February. The end of month inventory of 425,000 homes, when combined with March’s sales pace, equates to 6.4 months of supply.
After a slight rebound last week, zinc pricing regained its downward momentum this week.
Zinc pricing came in at $1.18/lb this week, down from last week and is at its lowest level in over a year.
After the run up over the previous three months, spot iron ore pricing has remained steady over the past couple of weeks.
- Spot iron ore pricing is currently at $117.60/mt, down from last week and down nearly 3% from last month, however up 5.0% over the last 90 days.
A wave of new supply, combined with a weaker demand environment has helped to push coking coal pricing lower as of late.
- Coking coal pricing currently sits at $249.50/mt, down 6.0% from last week and down 25.3% from a month ago.
- Coking coal pricing is now down 36.0% from the recent peak seen in mid-February.
U.S. raw steel production increased slightly last week, climbing for the third consecutive week.
- U.S. steelmakers produced 1.700 million tons at an 75.6% utilization rate.
- The current YTD utilization rate is at 74.5%, down 4.6% compared to the same time last year.
Preliminary carbon steel imports increased slightly in March after hitting a three month low in February.
- Preliminary carbon steel imports totaled 1.956 million tons in March, up 16.0% from February but down 17.8% from 2.380 million tons in March 2022.
- On a daily pace, March imports were up only 4.8% compared to February.
- Carbon flat rolled imports totaled 452,918 tons, up 11.1% from February but down 44.2% from 811,304 tons in March 2022.
- Flat rolled imports were basically flat month-over-month on a daily basis.
- Looking on a year-over-year basis, all three flat rolled products saw higher than 40% declines, with hot-dipped galvanized imports (-47.0%) sliding the most.
- For Q1, total flat rolled imports are down 39.7% compared to Q1 2022 and are at their lowest Q1 total since 2011.
Preliminary April import licenses, (24 days), showed total carbon steel imports are down 6.1% from the same time in March and down 10.1% from the same pace in April 2022.
- Coated import licenses are down as well from March, and are at their lowest daily rate since December.
After a slight pullback in February, new home sales rebounded in March.
March new home sales came in at a 683,000 unit rate, up 9.6% from February but still down 3.4% from a 707,000 unit rate in March 2022.
New sales have now seen year-over-year declines in twenty-two consecutive months.
- For Q1, actual sales are down 13.9% compared to Q1 2022 but are up nearly 40% from total sales in Q4 2022.
- Despite the pick up in sales, the amount of homes for sale at the end of the month was flat compared to February.
- The end of month inventory of 425,000 homes, when combined with March’s sales pace, equates to 6.4 months of supply.
Confidence among U.S. consumers declined in April after a slight uptick in March.
The Conference Board’s Consumer Confidence Index came in at 101.3 in April, down from 104.0 in March.
The Present Situation Index increased however, climbing to 151.1 from 148.9 previously.
The Expectations Index, a short-term outlook, declined however, sliding to 68.1, down nearly 6.0 from 74.0 in March.
- The Expectations Index has now been below 80 every month since February 2022, aside from a slight tick above it in December.
- Any reading below 80 is associated with a recession within the next year.
- Overall, purchasing plans for homes, autos, appliances, and vacations, all pulled back in April.
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.