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November 15, 2007

Steel and Aluminum Shipments and Inventories Continue their Slide in United States, Canada

November 15, 2007

Steel and Aluminum Shipments and Inventories Continue their Slide in United States, Canada

ROLLING MEADOWS, Illinois, November 15, 2007 – Although steel shipments rose slightly from year-ago levels for the first time since August 2006, steel product inventories at U.S. metals service centers continued to decline in October, reaching levels that, for the current cycle, are at or near their cyclical lows, the Metals Activity Report from the Metals Service Center Institute shows.

U.S. aluminum shipments continued to sag as inventories of the metal reached their lowest level in five years. In Canada, October shipments and inventories of both steel and aluminum products continued to decline from year-earlier levels.

 

Steel Product Activity

Shipments of steel products from U.S. metals service centers totaled 4.7 million tons in October, up 1.7% from October 2006 but off 2.3% on a seasonally adjusted basis. Steel product inventories at the end of October totaled nearly 12.26 million tons, 27% below year-ago levels and the lowest since March 1998, when inventories totaled 12.25 million tons. At current shipping rates, U.S. steel inventories represented a very low 2.6-month supply.

In Canada, metals service centers shipped 331,700 tons of steel during October, or 1.7% below year-ago shipments (down 6.6% on a seasonally adjusted basis). Month-end steel inventories totaled 1.1 million tons, 19.7% below October 2006 supplies. At current shipping rates, Canadian steel inventories were sufficient for 3.3 months.

 

Aluminum Product Activity

Shipments of aluminum products from U.S. metals service centers totaled 102,100 tons, or 3.9% below October 2006 shipments (down 7.9% on a seasonally adjusted basis). Month-end aluminum inventories totaled 271,500 tons, down 30.8% from a year ago and at the lowest level since June 2002, when aluminum stockpiles totaled 261,000 tons. The October inventory total was sufficient, at current shipping rates, for 2.7 months.

Canadian metals service centers shipped 10,500 tons of aluminum products during October, down 0.7% from a year ago (down 4.8% seasonally adjusted). Aluminum inventories totaled 27,800 tons, 15.6% below last year’s total. At current shipping rates, Canadian inventories were sufficient for 2.7 months of sales.

The Metals Activity Report (MAR), based on data from metals service centers in the United States and Canada, is produced by the Metals Service Center Institute and a third-party econometrics and strategy firm, McCoy, Scott & Co. MSCI tracks the relationships between many external economic variables and MAR shipment levels on a regular basis. The statistical validity of these relationships describes the credibility of the MSCI data and the importance of the metals distribution channel to the manufacturing economy as a whole.

Founded in 1909, the Metals Service Center Institute has more than 420 members operating from about 1,200 locations in the U.S., Canada, Mexico, and elsewhere in the world. Together, MSCI members constitute the largest single group of metals purchasers in North America, amounting each year to more than 65 million tons of steel, aluminum, and other metals, with about 300,000 manufacturers and fabricators as customers. MSCI’s membership also includes almost all ferrous and non-ferrous industrial metals producers in North America. Metals service centers inventory and distribute metals and provide first-stage fabrication services.

Contacts:

Chris Marti, vice president, research (847) 485-3009, cmarti@msci.org

Steve Weiner (847) 485-3011, sweiner@msci.org