A Letter to our Customers
Our Commitment to You
The Latest from the Market
- The U.S. imported a total of 2,773,000 net tons (NT) of steel in April 2020 (up 58.2% from March), including 1,309,000 NT of finished steel (down 13.5% from March). From January through April 2020, total and finished steel imports are 9,185,000 and 5,819,000 NT, down 20.3% and 28.2%, respectively, compared with the same period last year. It is estimated that annualized total and finished steel imports in 2020 would be 27.6 and 17.5 million NT, down 1.4% and 17.1%, respectively, from 2019. Finished steel import market share was an estimated 21% in April and is estimated at 18% over the first four months of 2020.
Industrial output fell a record 11.2% in April, pulled down by a record drop in manufacturing.Capacity utilization slumped to a record low 64.9% from 72.7% in March. Read the full release here. (5/15/20)
It’s difficult to predict whether industrial metal prices have found a bottom, but small signs of life appear to be emerging in the market as of late on the back of supply rationalization. Our risk managers highlight some to watch in the May Monthly Market Report. Read the full report here. (5/9/20)
The April PMI (Purchasing Managers’ Index), released by the Institute for Supply Management, registered 41.5%. While this reading was down 7.6 percentage points from the March reading of 49.1%, it was above analyst expectations of 36.9%. (5/1/20)
This week has brought some historical developments on the oil front:
• On April 20, U.S. crude oil futures fell below $0 for the first time in history, ending the trading day at minus $37.63/barrel. Brent crude, the international benchmark, also slumped. However, this contract was not as weak due to the fact that more storage is available worldwide.
• According to the U.S. Energy Information Administration, energy exports from the U.S. reached 23.6 quadrillion British thermal units in 2019. This is an all-time high and marks the first time in 67 years that annual U.S. gross energy exports exceeded U.S. gross energy imports. More info here (4/20/20)
March data coming out of China shows strong demand conditions for key metals, according to Deutsche Bank. Among the highlights are:
• Demand for copper rose 25% year-over-year in March, versus a 10% year-over-year contraction in Jan-Feb.
• Steel experienced a more moderate rebound with demand falling 4% year-over-year in March compared to a 16% year-over-year contraction in Feb. (4/14/20)
Regarding supply-side constraints, the extension of nationwide shutdown policies in key mining locations has been the main development this month, according to Deutsche Bank. It notes, however, that this current phase of extensions saw some policies adjust to lighten constraints on the mining sector (for example Quebec province in Canada). (4/14/20)
The OPEC+ group agreed to collectively cut production in May and June by 9.7 MM barrels/day and has committed to a series of cuts through April 2022. This cut, along with expected declines and shut-ins to occur throughout the globe in the coming months, could remove up to 14 MM barrels/day in May and June. (IHS Markit, 4/14/20) - More info here
Saudi Arabia and Russia will reduce output to 8.5 MM barrels/day each, from an agreed common baseline of 11 MM barrels/day. According to IHS Markit, “On a global basis, these cuts remove the specter of an aggressive price war and lowers the likelihood that global tank tops will be breached but does not solve the distress physical markets are likely to face in May and June.”
According to DHL, ocean freight services, with limited instances of equipment shortages and overbooking, are moving mainly as scheduled with minimal delays. This could change based on the transition of shipments from air freight to ocean freight transportation, although it is impossible to predict the volume or impact at this time. (4/6/20)
DHL recently published its Ocean Freight Market Update on March 31 and provided a snapshot of the outlook by region (chart courtesy of DHL Ocean Freight Market Update)
In the week ending on March 28, 2020, domestic raw steel production was down week-over-week to 1,670,000 net tons down 9.8% from 1,852,000 net tons, while the capability utilization rate fell to 71.6%. compared to 79.4% the previous week. Further, compared to the year-ago period of 1,913,000 net tons and a capability utilization rate of 82.2%, the current week production represents a 12.7% decrease from year-ago period.
Adjusted year-to-date production through March 28, 2020 was 23,653,000 net tons, at a capability utilization rate of 80.7%. That is down 1.0% from the 23,881,000 net tons during the same year-ago period when the capability utilization rate was 81.6%. All data courtesy of the American Iron and Steel Institute. (4/6/20)
Ryerson Proud to Serve
In the fight against COVID-19, Ryerson is proud to serve a broad range of essential industries. Interact with the graphic below to discover the grades behind each product, along with links to purchase metal online.