Our Metal Price Trends series provides monthly insight into industry news and economic activity affecting global metal prices, and empowers Metal Supermarkets customers to make timely and informed decisions when purchasing metal.
In October 2014, prices remained relatively unchanged in Aluminum, but decreased in Hot Rolled Steel, Cold Rolled Steel, and Stainless Steel.
The U.S. manufacturing PMI fell to 56.2 in October from 57.5 in September. The index was the lowest since July and lower than the third quarter average of 57.1. However, employment showed continued strength with October remaining at the same levels of the previous month. Strong hiring patterns are a good indication that manufacturers are optimistic about future business conditions.
Aluminum – In October prices have remained unchanged from the previous month. The aluminum market is expected to have its first deficit in eight years due to global production cutbacks and increased demand. In early 2014, as a reaction to increasing electricity prices and reduced profit margins, mills around the world decreased smelter output. As demand increases, production will be brought back online gradually, but supply will remain tight. These conditions typically result in increased pricing.
Carbon Steel – In October the prices of both Hot Rolled and Cold Rolled decreased. In the US prices have continued to decline throughout the month, as mills offered discounted prices in order to increase sales. In reaction to this development, purchasers have been buying only as needed in the hope of further price reductions. Recently AK Steel announced mill price increases effective in November. At present any price increase will be difficult to achieve during the seasonal slowdown, although product availability remains abundant, both domestically and imported. The other factors that continue to affect prices are the decline in service center inventories (due to demand), the high prices in the USA when compared to other regions, and the decrease in raw material costs.
Stainless – In October the prices of Stainless Steel decreased slightly. Stainless steel sales in the US have remained steady, while customer confidence has improved due to lower oil prices. While business has not returned to pre-inflation levels, it is markedly better than in Europe. Because of this situation, suppliers from that region have been offering considerably lower prices. This is in turn has placed pressure on the domestic mill pricing.
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