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February 19, 2008

Steel and Aluminum Shipments Declined in January

February 19, 2008

Steel and Aluminum Shipments Declined in January

ROLLING MEADOWS, Illinois, February 19, 2008 – Despite the weak overall economy, January declines in steel and aluminum shipments from U.S. and Canadian metals service centers were small, suggesting more strength in metals end-user markets than had previously been supposed, the Metals Activity Report from the Metals Service Center Institute shows.

Steel shipments were down from year-earlier levels just 2.7% in the United States and 2.3% in Canada, while Canadian aluminum shipments dropped a modest 1.3%. Only the 5.9% decline in U.S. aluminum shipments suggested larger economic weakness, yet that number, following the 13.4% year-over-year decline in U.S. aluminum shipments in December, was also relatively small.

Aluminum inventories in both countries rose, and Canadian steel inventories also rose slightly. Steel inventories at U.S. service centers declined by less than 1% from December levels.

Steel Product Activity

Steel shipments from U.S. metals service centers fell to 4.5 million tons in January. Month-end inventories totaled nearly 12.2 million tons, 25% lower than a year ago. At current shipping rates, the number of months of supply on hand was 2.7, well below the December months-of-supply figure because of the onset of typical spring seasonal supply requirements.

Canadian service centers shipped 329,400 tons of steel during January, down 2.3% from a year ago. Steel inventories in Canada ended the month at 1.2 million tons, or 3.8% below January 2007, but slightly larger than in December. Canadian steel inventories equaled a 3.7-month supply at current shipping rates, like the U.S. months-of-supply figure well below December.

Aluminum Product Activity

U.S. service centers shipped 98,800 tons of aluminum products in January. Year-over-year inventories were down 24.5%, at 277,200 tons, but rose slightly from inventories at the end of December. Aluminum stocks equaled a 2.8-month supply at current shipping rates.

Canadian metals service centers shipped 10,000 tons of aluminum products during January, down 1.3% from a year ago. Inventories, although down 0.9% from January 2007, rose to 30,300 tons, a 3.0-month supply at current shipping rates.

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

 

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