PRICES INCREASED SHARPLY ONCE AGAIN IN JUNE
The Consumer Price Index increased 1.3% from June and was up a sharp 9.1% on a year-ago basis. This was the largest year-over-year increase in prices since November 1981. The energy sector increased 41.6% over the last twelve months, the largest 12-month increase since April 1980. The food sector increased 10.4% from June 2021, the largest increase since February 1981.
After rebounding last week, zinc pricing continued to slide this week on the prospects of declining demand through the back half of the year.
Spot iron ore pricing saw another decline after sliding last week.
Pacific Basin met coal pricing continued its recent slide this week.
Current pricing is at $243.50/mt, down nearly 14.6% from the end of last week.
While pricing is still down 36% compared to this time last month, pricing is up 16% from this time last year.
The July Chicago #1 busheling came in at $475/gt, this is down $135 (+20%) from June and is at its lowest level since December 2020.
Shredded pricing declined to $460, down slightly from $490 previously.
The current $15 prime premium to shredded is the lowest it has been since Q4 2020.
Domestic raw steel production dropped last week after climbing the previous weeks.
- U.S. steelmakers produced 1.750 million tons at an 79.3% utilization rate.
- This was the first week below 80.0% utilization since the second week of April.
- YTD production is now down 2.3% from the same time last year.
Based on preliminary carbon flat rolled import licenses, daily average imports for July (11 days) are down 5.9% compared to the rate through the same time in June.
- The coated flat rolled import rate is down 24.9% compared to the rate in June.
After sliding in April, shipments of HVAC equipment increased in May.
Shipments totaled 2.073 million units, up 1.0% from April but were down 3.9% from 2.158 million units in May 2021.
Shipments have now declined, on a year-over-year basis, for consecutive months.
- On a year-over-year basis, to help smooth seasonality, the only sector to increase was A/C & heat pumps, which were up 0.1%. Sales of both cars and light trucks increased in June, climbing 1.8% and 1.0%, respectively.
- Both water heater and furnace shipments declined, sliding 9.2% and 4.0%, respectively.
- Despite the recent decline in shipments, year to date shipments are still up a slight 0.1% compared to the same timeframe last year.
May carbon flat rolled consumption came in at a rate of 145.1 thousand tons/day, down from April and below the 154.2 thousand tons/day rate in May 2021.
Year to date total carbon flat rolled consumption came in at 22.57 million tons, down 1.0% from the same timeframe last year.
After climbing the previous two months, per/day coated flat rolled consumption declined sharply in May, sliding 8.3% to 56.3 thousand tons/day.
- May was also down 8.3% from 61.0 thousand tons/day rate in May 2021 and is at its lowest daily rate since February 2021.
After sliding last month, shipments of tractors and combines increased in June.
Prices paid by consumers increased sharply once again in June.
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.