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Market Update
The Gerdau Market Update tracks and analyzes over 100 data streams that affect long steel consumption, attempting to provide the latest on market trends. Below, you will find the most recent information about Macroeconomics, Steel Econometrics, Construction and Manufacturing as it becomes available.
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Crude Oil & Natural Gas Pricing: May’s average West Texas Intermediate (WTI) crude oil price per barrel decreased 6% month on month (m/m). The WTI is up 12% year on year (y/y), coming in at $80.12 / barrel in May 2024 vs. $71.58 / barrel in May 2023.
Currency Report: The trade-weighted U.S. Broad Dollar Index posted a reading of 122.244 in May, down 0.22% m/m, reversing trend after increasing last month. This index value is up 1.99% on a year on year (y/y) basis. Month over month, we saw the Brazilian real, Canadian dollar, Chinese yuan, Mexican peso, and South Korean won strengthen vs. the USD in May.
Employment by Industry (U.S.): In May 2024, the total number of seasonally adjusted (SA), non-farm people employed in the U.S. was 158.5 million (M) – an increase of 272,000 (+0.2%) month on month (m/m). When compared to May 2023, total employment is up by 1.8% year on year (y/y). Among the employment sectors that we track at Gerdau, we saw the greatest monthly gain in the construction of buildings sector with a growth of 0.3% m/m.
U.S. Steel Capacity Utilization: The total tonnage for the week ending May 15th was 1.735 million net tons, at a capacity utilization rate of 77.2%. The year-to-date tonnage output is 35.992 million net tons, at an average capacity utilization rate of 77.1%. In 2023, the same output total was 35.144 million net tons, at an average capacity utilization of 74.7%.
Construction Put-in-Place, (CPIP): Total U.S. construction spending continued to perform well in April 2024, especially in the private sector. Census Bureau non-seasonally adjusted (NSA), constant dollar CPIP data showed that April’s three month total (3MT) construction expenditures grew by 9.2% year on year (y/y) to 316.6 billion. On a 12MT basis, private expenditures increased by 5.2% y/y.
Oil and Gas Rotary Rig Counts: The total number of operating rigs in Canada for the week ending May 31st was 74 oil and 54 gas (totaling 128). In percentage terms, on a month on month (m/m) basis, oil rigs were up 23.3% and gas down 10.0%. On a year on year (y/y) comparison, rigs were up 45.1% for oil and up 17.4% for gas. The combined figure for y/y was +32.0% or +31 rigs.