SMU survey: Mill lead times stretch out marginally - Steel Market Update

SMU Data and Models

Written by Brett Linton

October 10, 2024

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Steel mill lead times inched up this week for most sheet and plate products, according to buyers responding to our latest market survey. Compared to late-September, lead times have marginally extended for all products other than galvanized. Overall, lead times remain near some of the shortest levels witnessed this year.

Production times are mixed this week compared to those seen one month prior, but higher for all products vs. levels three months ago. For sheet products, lead times for hot-rolled steel remain around five weeks on average and tandem products are all hovering around seven weeks. Plate lead times continue to register about four weeks, around where they have been since mid-July.

Table 1 below summarizes current lead times and recent trends.

Compared to our Sept. 25 market check, the upper and lower limits for some of our lead time ranges this week have changed:

Just over half of the companies we surveyed this week believe lead times will be flat two months from now, down from 67% in our prior survey. A third expected production times to extend further (up from 20% in late-Sept.). The small remainder (9%) believe lead times will shrink further (vs. 13% two weeks prior).

We also asked buyers how they classify current mill production times. The majority continue to respond that they are either shorter than normal (47%) or within typical levels (44%). A small portion of buyers said lead times are slightly longer than normal (9%).

“Domestic lead times have started to slip. We expect that to continue due to poor demand across the board.”

“Normal cyclical curve for the steel market. Mill outages in December will push out lead times.”

“I think once the presidential election is decided, people/businesses will have some direction and business will pick up a bit.”

“In the next 30 days, they go down and then stabilize as buying picks up.”

“I expect a lead time push because of a rebound of steel demand.”

Figure 1 below tracks lead times for each product over the past two years.

One way to smooth out the variability seen in our biweekly readings and better highlight trends is to view lead time data on a three-month moving average (3MMA) basis. Through Oct. 9, 3MMA lead times increased ever-so-slightly on sheet products and marginally eased on plate products.

On a 3MMA basis, sheet lead times have begun to flatten out in recent months, while plate lead times continue to shrink. Generally all 3MMA lead times have trended downwards since February and remain at some of the shortest levels seen in the past year.

The hot rolled 3MMA is now at 4.82 weeks, cold rolled at 6.69 weeks, galvanized at 7.04 weeks, Galvalume at 7.13 weeks, and plate at 4.15 weeks.

Figure 2 highlights lead time movements across the past four years.

Brett Linton is a senior analyst for Steel Market Update, where he began his career. Linton has been in the steel industry since 2010. He has held roles as a category manager and strategic insights director at Reibus before returning to SMU in 2024. He is a graduate of The University of North Georgia with a degree in Finance and Accounting. Brett can be reached at [email protected] or 724-314-0179.

SMU’s latest steel buyers market survey results are now available on our website to all premium members. After logging in at steelmarketupdate.com, visit the pricing and analysis tab and look under the “survey results” section for “latest survey results.” Past survey results are also available under that selection. If you need help accessing the survey results, or if […]

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