2023: The Year in Metal

2023 was a year marked by dynamic shifts and significant events that shaped the landscape for industrial metals, setting the stage for what should be an eventful 2024.

Let's dive into the year's most significant trends and events that defined the metal industry in 2023.

The Awakening of a Giant

As the year began, China’s shift in COVID-19 policies hinted at a significant resurgence in global commodities. The country’s easing restrictions stirred hope for a revival in demand, propelling a surge in commodity prices like copper and iron ore.

Influenced by past short squeezes, Nickel market dynamics led to market hesitancy on the London Metal Exchange (LME) and set the stage for alternative trading options. Meanwhile, aluminum faced balancing acts between softening ingot prices and rising Midwest Premium costs, signaling an eventful year ahead.

Volatility continued in February, notably impacting stainless steel surcharges due to unpredictable nickel and molybdenum prices. Steel markets defied traditional trends amid interest rate hikes, with hot-rolled coil prices showing remarkable divergence from anticipated commodity price trends. The global steel market displayed varying trends across major regions, reflecting shifting manufacturing activities and economic indicators.

Bank closures were a large part of the global economic landscape early in 2023. Nick Webb, Ryerson's director of risk management, commodity hedging, took a closer look at this topic as it related to the metals market. 

Shifting Steel Landscapes

May brought nuanced shifts in the steel market across major producing regions. European steel prices stabilized at around $850/ton, while a contrasting downward trend appeared in China, where prices hovered around $535/ton, reflective of subdued manufacturing activity.

A ripple effect was felt globally as China’s manufacturing slowdown challenged its historically offsetting role in other major manufacturing economies.

In June, US steel mills announced price hikes on hot-rolled coil prices, aiming to provide stability amidst declining prices. Despite the expectation of increased imports due to rising domestic prices, the flood of imports remained controlled, allowing domestic producers to maintain pricing discipline. Futures pricing data hinted at stabilization rather than a prolonged upward trajectory in steel prices.

In June Ryerson's Cup o Joe crew sat down with Patrick Dempsey, General Manager Commercial at Nucor Corp., to talk about these trends and more. Check out the episode below:

July saw incremental signs of stabilization in the steel market. The domestic price of hot-rolled coil remained steady at $885/ton, indicating potential market stability. Factors contributing to this included steadying prices in the Chinese steel market, controlled import levels, and futures pricing data suggesting stabilization rather than prolonged price increases.

Meanwhile, aluminum faced challenges as producer price inflation hit its lowest since August 2020, potentially signaling positive developments for its supply.

Complex Dynamics Unfold

The latter part of the year showcased intricate relationships between interest rates, currency strength, and commodity prices, significantly impacting industrial metals.

Steel prices fluctuated, stabilizing around $800/ton despite market fluctuations and forecasts indicating marginal movement in the upcoming months. The automotive industry's reliance on steel surfaced during strikes, highlighting potential disruptions to the steel supply chain.

The strike, involving major automakers like Ford, General Motors (GM), and Stellantis, disrupted the supply chain and production capacities. This event highlighted the automotive industry's critical dependence on steel, constituting about 54% of an average vehicle, and raised concerns about potential disruptions throughout the steel supply chain.

During this time, Brian Crane, product manager at Ryerson, dove into potential mill consolidation and other topics impacting the carbon steel market. 

Carbon sheet prices fluctuated, hitting their lowest point of the year at around $699/ton in early September. Such disruptions or plant shutdowns stemming from the strike could significantly impact steel supply and demand, further accentuating the complexities of an already intricate commodities market.

Nickel and aluminum markets faced their own challenges, with projections indicating excess supply in nickel while aluminum maintained a relative balance between supply and demand.

Fighting Supply Chain Disruption

Through it all, manufacturers continue to deal with significant global supply chain questions. In fact, according to a survey of nearly 1,000 Ryerson customers, disruptions: whether big or small, whether big or small, impacting 75% of respondents.

We understand the challenges and opportunities in this dynamic landscape and launched a microsite called Ryerson Advanced Processing, which provides resources and support you need to chart a successful course. Our community is dedicated to equipping you with the knowledge and tools necessary to manage and mitigate supply chain disruptions effectively.

Steel Prices in 2024

2023 unfolded as a dynamic year in the metal industry, marked by market fluctuations, supply-demand imbalances, and intricate relationships between key commodities and economic indicators.

The interplay of factors like interest rates, currency strengths, and global economic shifts played a pivotal role in shaping the commodities landscape.

As the year concludes, projections hint at continued volatility, presenting challenges and opportunities for stakeholders across various sectors of the metal industry.

Amidst these complexities, adaptability and strategic foresight will remain crucial for navigating the evolving metal markets in the coming year. To help you prepare, Ryerson's Engauge 2024, slated for February 1, emerges as a pivotal virtual event, uniting industry pioneers to navigate uncertain landscapes.

An esteemed economist from ITR Economics will deliver an economic forecast, while our director of risk management and commodities hedging will provide a comprehensive metal commodities update. The highlight? A compelling keynote delving into the role of Artificial Intelligence (AI) in manufacturing, unveiling its transformative power and strategic implications for industry professionals keen on leveraging technological advancements for progress.

Register by clicking the banner below:

Ryerson: The Metal Supplier of Choice

Ryerson is a leading North American metal supplier that provides more than just metal. We respond to the ever-changing needs of manufacturing today.

With a vast inventory of steel, stainless, aluminum, alloy, and more, we are committed to providing our customers with the metal and services they need to succeed. We stock a range of shapes and sizes, or we can provide processing and fabrication for every product we sell

Order online at Ryerson.com for comprehensive pricing and fast delivery, or contact us today to learn more about how we can meet your metal needs.