A stable outlook is predicted for the U.S. steel industry in 2018 following last year’s demand growth, which Moody’s Investors Service described as “stronger than in many years.”
According to the Institute of Supply Management’s Purchasing Managers’ Index (PMI), Moody’s reported, the average rating in 2017 was about 57.5—readings above 50 indicate expansion. In the January 2018 reading alone, the PMI nearly reached 60. Moody’s Senior Vice President Carol Cowan said in a Feb. 22 report that demand growth in the country’s steel industry should spark stronger prices as well as capacity utilization levels.
Results similar to those in 2017 are expected in 2018 over the next year, year and a half, Moody’s reported.
“We expect 2018 capacity utilization to be 70% to 75% and hot-rolled prices to average between $650 to $700 per ton,” Cowan said in the report.
Moody’s said the U.S. tax legislation might also aid steel consumers by contributing to manufacturing and capital spending investment growth.
—Andrew Michaels, editorial associate