Final Thoughts

I received a comment/question over the weekend regarding our SMU Steel Buyers Sentiment Index. The comment came in the form of a LinkedIn comment to one of our posts regarding the most recent Sentiment Index announcement. The question was from a financial analyst who asked us why our Sentiment Index did not reflect the WARN notices going back to 2015 and idling of capacity at the domestic steel mills?

My response is that one should not confuse the domestic steel mills and their financial issues with that of the manufacturing and distribution community from which we gather the vast majority of our responses. Our Sentiment Index is measuring how buyers and sellers of steel (not steel mills) feel about their company’s (not the steel industry in general) ability to be successful in the current market environment as well as 3 to 6 months into the future. The steel mills do participate in our market analysis but they only represent 6 percent of the total respondents in our most recent analysis. Even so, not every mill participates and those that do tend to be more successful and they tend to interact more often with SMU than those who have issues.