The global construction markets appear to be mostly robust, with the US market leading the way. This is reflected in this week’s US shredded scrap price on MetalMiner’s weekly Construction MMI®, which hit a 3-week high (more detail below).
As we reported earlier in our monthly Construction MMI® for September, US construction spending finally caught its stride, hitting its highest level in more than 5-1/2 years as private construction increased and state and local government outlays surged. The ISM’s PMI hit 59 for the August reading, the highest rating since March 2011.
Meanwhile, in China, their manufacturing PMI for August hit 50.2 – cooler than anticipated. Hongbin Qu, Chief Economist, China & Co-Head of Asian Economic Research at HSBC, was quoted as saying: “The revisions were mixed, with upward revision to the new export orders and output sub-indices but downward revisions to the employment and input prices indices. Although external demand showed improvement, domestic demand looked more subdued. Overall, the manufacturing sector still expanded in August, but at a slower pace compared to previous months. We think the economy still faces considerable downside risks to growth in the second half of the year, which warrant further policy easing to ensure a steady growth recovery.”
So what does this mixed-bag construction sector outlook portend for near-term metal and material prices?
This Week’s Metal Prices Affecting Construction Sector
The week’s biggest mover on the weekly Construction MMI® was the price of US shredded scrap, which saw a 0.3 percent increase to $382.00 per short ton. This week marked the third in a row of rising prices for the metal.
Following a steady week, prices for the Chinese low price of 62% Australian iron ore fines closed flat at CNY 970.00 ($157.95) per dry metric ton. Chinese H-beam steel prices held steady from the previous week at CNY 3,230 ($525.94) per metric ton. At CNY 3,220 ($524.31) per metric ton, the week finished with no movement for Chinese rebar.
Following a steady week, prices for Chinese aluminum bar closed flat at CNY 14,200 ($2,312) per metric ton. At EUR 2,489 ($3,208) per metric ton, the price of European 1050 aluminum did not change since the previous week.
The weekly US Gulf Coast bar fuel surcharge stayed essentially flat at $0.50 per mile. Closing at $0.53 per mile, the weekly US Rocky Mountain bar fuel surcharge remained unchanged for the week. This past week, the weekly US Midwest bar fuel surcharge kept quiet, holding at at $0.51 per mile.
The Construction MMI® collects and weights 9 metal price points used within the construction industry to provide a unique view into construction industry price trends. For more information on the Construction MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.