November 20, 2008

Steel inventories in US in June continue deteriorating

According to the latest Metals Activity Report from US based Metals Service Center Institute, US and Canadian metals service centers, continued deterioration of economic conditions added to seasonal and cyclical weakness for metals shipments in June. End of June inventories of those metals also fell from 2007 levels, though slower activity contributed to slightly higher steel inventory levels in the US compared to last month.

Steel shipments from US metals service centers totaled 4.2 million tons in June 2008 down 4.3% from shipments during June 2007. First half 2008 steel-product shipments totaled nearly 26.3 million tons, off 3.8% from a year ago. Inventories, at nearly 12.9 million tons of steel products, were down 7.3% from last year and, at current shipping rates, represent a 3.1 month supply.

In Canada, steel product shipments from metals service centers totaled 293,000 tons in June, down 6.0% from June 2007 and first half shipments of almost 1.9 million tons were down 2.7% from a year ago. Canadian service center steel inventories of about 1.06 million tons at the end of June were down 12.1% from a year ago and, at current shipping rates, represent a 3.6 month supply.

The Metals Activity Report, based on data from metals service centers in the United States and Canada, is produced by the Metals Service Center Institute and a third party econometrics and strategy firm, McCoy, Scott & Co.

Founded in 1909, the Metals Service Center Institute has more than 420 members operating from about 1,200 locations in the US, Canada, Mexico and elsewhere in the world. Together, MSCI members constitute the largest single group of metals purchasers in North America, amounting each year to more than 65 million tons of steel, aluminum, and other metals, with about 300,000 manufacturers and fabricators as customers.