Steel buyers remain confident in market outlook according to SMU survey

Steel buyers retained a positive view of the market according to SMU’s Survey on Buyers’ Sentiment. The sentiment indices revealed mixed movements but continued to exhibit strength, demonstrating optimistic attitudes among steel buyers towards the success of their companies.

In February, the Current Sentiment Index reached a 10-month peak but experienced a decrease in the latest assessment, marking the second consecutive decline. Despite the drop, the reading remains notably high over the past year, suggesting that buyers are confident about their companies’ prosperity.

Conversely, the Future Buyers’ Sentiment Index saw a rebound after a month of declines. The trend in future sentiment reflects the ongoing positive outlook among buyers for the first half of the year. Previous surveys had indicated that Current Sentiment surpassed Future Sentiment, indicating a stronger belief in present business conditions than in future prospects. However, the latest findings show a reversal to the conventional pattern, with buyers expressing greater optimism towards future opportunities.

Every fortnight, SMU surveys nearly 2,000 steel industry executives to gauge their assessment of their companies’ current prospects for success and business expectations over the next three to six months. The Current and Future Steel Buyers’ Sentiment Indices are derived from these responses, with metrics that have been monitored since SMU’s establishment.

Current Sentiment saw a decline of six points, settling at +56 this week. Although it represents a decrease, it remains among the top readings in the past nine months. In comparison, the 2024 average for Current Sentiment was +48, marginally higher than the current figure.

On the other hand, the Future Sentiment Index recorded an increase of four points, reaching +64. This growth nearly offset the previous decline from two weeks ago. Despite a general downward trend since late 2024, Future Sentiment remains considerably optimistic, maintaining a level that averaged +65 throughout 2024 and was recorded at +70 a year ago.

Survey respondents highlighted various observations regarding the market, emphasizing concerns such as the impact of trade cases, potential risks related to imports, cost implications of tariffs, and uncertainties in the business environment. Despite these issues, there are positive sentiments related to domestic supply chains, pricing trends, and business stability.

In terms of sentiment trends, the Current Sentiment 3-month moving average saw an upward trajectory, reaching a nine-month peak of +51.37. Conversely, the Future Sentiment 3-month moving average showed a decline over the past six weeks, settling at +64.99, a five-month low after a high in February.

The SMU Steel Buyers’ Sentiment Index serves to gauge the attitudes of buyers and sellers in the North American flat-rolled steel products market. It is a specialized tool designed by Steel Market Update to provide insights into the anticipated behavior of steel buyers. Tracking these sentiments is valuable in predicting future market dynamics. If interested in partaking in the survey, contact via email at info@steelmarketupdate.com.