Service centersrsquo shipment and inventory volumes offer insight to the current state of manufacturing activity in North America as both indexes correspond to a substantial volume of the metals consumed by machine shops fabricators and other manufacturers
Service centers’ shipment and inventory volumes offer insight to the current state of manufacturing activity in North America, as both indexes correspond to a substantial volume of the metals consumed by machine shops, fabricators, and other manufacturers.

Service Center Shipments Slower but Still Strong in June

Year-to-date steel, aluminum deliveries show momentum, while inventory tonnages are mostly even.

North American metals service center shipments declined slightly from May to June, though the year-over-year volumes remained mostly positive, allowing the Metals Service Center Institute to note, “shipments continued the modest growth path established in May.” During the same period, service centers’ steel inventories increased while aluminum inventories declined slightly.

MSCI reports shipment and inventory totals for service centers in the U.S. and Canada in its monthly Metals Activity Report. Both indexes offer insight to the current state of manufacturing activity, as service center-supplied aluminum and steel correspond to a substantial volume of the metals consumed by machine shops, fabricators, and other manufacturers.

U.S. service centers shipped 3.42 million tons of steel products during June, just 0.2% less than the May shipment total and 1.1% more than the June 2016 total. The average daily shipping rate declined by about 300 tons to 155,600 tons/day, but with the year-to-date(January-June) shipment total at 20.09 million tons, 2017 shipments are 3.5% higher than over the same period of 2016.

Also, U.S. service centers’ inventories of steel products ticked up 0.3% from May to 7.26 million tons, which is 4.9% lower than the June 2016 inventory total. At the current shipping rate, MSCI estimated that U.S. service centers are holding a 2.1-month supply of steel products.

Canadian centers shipped 392,600 tons of steel products during June, 5.4% less than during May but 5.0% more than during June 2016. The daily shipping rate dropped by about 900 tons to 17,800 tons/day. Year-to-date, Canada’s service centers have shipped 2.37 million tons of steel products, 2.4% more than during the January-June 2016 period. 

Inventories of steel products at Canadian service centers rose 2.6% from May to June, to 1.14 million tons at the close of last month. That figure is 1.6% more than June 2016’s total and represents a 2.9-month supply of steel products at the current rate of deliveries.

U.S. service centers shipped 147,400 tons of aluminum products during June, 3.6% more than during May and 10.3% more than during June 2016. The daily shipping rate rose by 200 tons from May to 6,700 tons/day, and the year-to-date total rose 7.1% over January-June 2016 to 832,900 tons for the most recent six-month period.

Aluminum product inventories at U.S. service centers declined slightly (-0.5%) May to 391,900 tons at the end of June, which is just 0.2% higher than the June 2016 inventory. At their current rate of deliveries, MSCI estimated that U.S. service centers are holding a 2.7-month supply of aluminum products.

Service centers in Canada shipped 10,500 tons of aluminum products (excluding extrusions) during June, 6.2% less than they shipped during May and 2.5% less than they shipped during June 2016. The daily shipping rate remained even with May at 500 tons/day. And, while the year-to-date total for aluminum products shipments increased to 62,700 tons for 2017, that total is 1.1% less than the January-June 2016 volume.

Canada’s service centers had 30,400 tons of aluminum products in inventory at the close of June, slightly (-0.3%) less than for May and 1.0% less than for June 2016. Their current inventory total represents a 2.9-month supply, according to MSCI’s estimate.

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