The monthly Automotive MMI® held steady at 97 as headline news indicated that despite strong SUV and pick-up truck sales for the month of May, the industry appears to have lost some of its momentum as the automotive OEMs have taken to offering more discounts and greater incentives for buyers.
A recent headline from the Wall Street Journal has now called that demand within the automotive market has reached stasis, “Uneven Gains Signal U.S. Car Demand Near Plateau,” while MetalMiner called the market at its peak back in February of this year and predicted demand weakness back then.
The index has now held steady at 97 for two consecutive months.
“We’re seeing some metals used in the automotive industry stay supported, whereas others have declined,” said Lisa Reisman, managing editor of MetalMiner. “Hot dipped galvanized prices saw a slight lift this month along with palladium bars and copper.” But other metals remain under pressure, including some aluminum, depending on origin.
So is this metals price index a leading economic indicator?
“The Auto MMI appears to serve as a leading economic indicator for overall growth in the auto sector as metal input costs correlate with overall auto sector performance,” Reisman said. “As we continue to build out monthly models with the MMI, we will begin to perform additional quantitative analysis to determine the degree of correlation and even if the Auto MMI shows predictive qualities from a statistical perspective.”
Key Price Drivers
After dropping the previous month, the price of US palladium bar prices rose 7.5 percent. The price of US HDG rose 2.5 percent after falling the previous month. After dropping the previous month, the copper 3-month price prices rose 2.5 percent on the LME to $7,285 per metric ton. The cash price of primary copper rose 2.4 percent on the LME to $7,245 per metric ton after falling the previous month. After dropping the previous month, the Chinese lead price prices rose 0.5 percent.
Following a 3.4 percent decline in price, US platinum bar finished the month lower.
The price of Korean 5052 coil premium over 1050 sheet held steady.
The Automotive MMI® collects and weights 7 metal price points used in automotive production to provide a unique view into automotive metal trends over a 30-day period. For more information on the Automotive MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.