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US, Canadian service center shipments decline

Created on Tuesday, 15 December 2015 15:24

US service centers' November steel shipments fell to the lowest point since December 2012, Metals Service Center Institute data released Monday showed.

Service centers carried 8.55 million st of steel at month's end representing 3 months of supply at the current low shipping level. Service centers shipped 143,100 st/day on average in November, down from 152,900 st/day in October.

US service centers shipped 2.86 million st in November, down 14.9% from 3.36 million st in October. November’s shipment total represented the lowest point since shipments fell to 2.53 million st in December 2012, according to MSCI data.

“Shipments typically decline sequentially in November (on average down 8.7% sequentially) and December, but this year, the year-on-year decline was more significant than in the past, and is off a low starting point, with this year’s shipments marking the weakest November shipments since 2009, and third weakest since 2002 (2008, 2009, and now 2015),” BMO Capital Markets analyst David Gagliano wrote in a research note.

Service center shipments fell for all products month on month and year on year but none more than carbon bars, which declined by 17% on month, according to BMO, while flat-rolled shipments fell by 15.3% from October.

Shipments in the first 11 months of the year were down 7.2% from the same period last year.

BMO found that inventories fell for all products month on month, except for structurals, which increased 2.2%.

Canadian service centers drew down steel inventories in line with shipments, according to the MSCI. At the end of November, Canadian service centers held 1.29 million st of steel, representing 3.2 months of supply, the same level as September and October.

Canadian service centers shipped 399,000 st of steel in November, down 5.5% from 422,400 st in October. In the first 11 months of 2015, total Canadian shipments were down 9.1%.

-- Estelle Tran, PLATTS