The CORE Problem Part 2 of 8 parts As seen through the eyes of Michael H. Keehn.
Outlook for 2007 As Seen Through the Eyes of the Buyers
27
Outlook for 2007 As Seen Through the Eyes of the Buyers Tom Stundza Tom Stundza Executive Editor Executive Editor Purchasing Magazine Purchasing Magazine Steel Manufacturers Association Annual Board of Directors Meeting Pointe Hilton Tapatio Cliffs Phoenix, Arizona February 16, 2007
-
Upload
branden-shaw -
Category
Documents
-
view
31 -
download
0
description
Outlook for 2007 As Seen Through the Eyes of the Buyers. Tom Stundza Executive Editor Purchasing Magazine Steel Manufacturers Association Annual Board of Directors Meeting Pointe Hilton Tapatio Cliffs Phoenix, Arizona February 16, 2007. - PowerPoint PPT Presentation
Transcript of Outlook for 2007 As Seen Through the Eyes of the Buyers
Outlook for 2007As Seen Through the Eyes of the
Buyers
Tom StundzaTom StundzaExecutive EditorExecutive Editor
Purchasing MagazinePurchasing Magazine
Steel Manufacturers Association Annual Board of Directors Meeting
Pointe Hilton Tapatio CliffsPhoenix, Arizona
February 16, 2007
2007, the year of the pigbad ‘feng shui’ for steelIt’s a year of fire & water – two elements that
don’t mix
Gross domestic Gross domestic productproduct
(annual, % change from year (annual, % change from year before*)before*)
1
2
3
4
5
'02 '03 '04 '05 '06 '07/F
* Chained 2000 dollars
2007: Watch for slow growth2007: Watch for slow growth
Gross domestic productGross domestic product(quarterly, annualized rate, $, (quarterly, annualized rate, $, trillions*)trillions*)
9.5
10.0
10.5
11.0
11.5
12.0
'03 '04 '05 '06
* Chained 2000 dollars
Trending up, graduallyTrending up, gradually
Purchasing managers’ Purchasing managers’
indexindex(monthly, diffusion index)(monthly, diffusion index)
40
50
60
70
80
'04 '05 '06 '07
Less than 50 = falling; greater than 50 = rising
Business Conditions
61.1
Buying plans indexBuying plans index
(monthly, diffusion index)(monthly, diffusion index)
40
50
60
70
80
90
'04 '05 '06 '07
Less than 50 = falling; greater than 50 = rising
90-day purchasing plans
69.4
Steel buying plans indexSteel buying plans index
(monthly, diffusion index)(monthly, diffusion index)
40
50
60
70
80
90
'04 '05 '06 '07
Less than 50 = falling; greater than 50 = rising
30-day purchasing plans
62.5
Steel buying plans Steel buying plans (monthly, % expanding buys)(monthly, % expanding buys)
20
30
40
50
60
'04 '05 '06 '07
30-day purchasing plans
40%
100
125
150
175
200
225
'04 '05 '06 '07
Purchasing price indexPurchasing price index (monthly, 100 = January 1992)(monthly, 100 = January 1992)
177.3
Steel prices-paid indexSteel prices-paid index
(monthly, diffusion index)(monthly, diffusion index)
40
50
60
70
80
90
100
'04 '05 '06 '07
Less than 50 = lower; greater than 50 = higher
59.5
75
100
125
150
175
200
225
250
275
300
'04 '05 '06 '07
Steel price indexesSteel price indexes (monthly, 100 = January 1992)(monthly, 100 = January 1992)
carbon
stainless
Forecasts of key Forecasts of key indicatorsindicators
(U.S., % change)(U.S., % change)
‘‘0404 ‘05‘05 ’06’06 ’07 ’07 oldold ’07 ’07 newnew
Gross domestic productGross domestic product 4.24.2 3.53.5 3.43.4 2.42.4 2.72.7
GDP price indexGDP price index 2.82.8 3.03.0 2.92.9 2.12.1 2.12.1
Consumer price indexConsumer price index 2.72.7 3.43.4 3.23.2 2.02.0 1.91.9
Consumer spendingConsumer spending 3.9 3.53.9 3.5 3.23.2 2.92.9 3.13.1
Capital spendingCapital spending 5.95.9 6.6.88 7.47.4 5.75.7 5.35.3
Industrial production Industrial production 2.52.5 3.23.2 4.04.0 2.62.6 2.42.4
Residential startsResidential starts 4.94.9 4.64.6 (13.0)(13.0) (16.4)(16.4) (15.0)(15.0)
Motor vehicle salesMotor vehicle sales 1.81.8 0.00.0 (13.0)(13.0) (2.4)(2.4) (2.4)(2.4)Blue Chip Economic Blue Chip Economic IndicatorsIndicators
Energy prices-paid indexEnergy prices-paid index
(monthly, diffusion index)(monthly, diffusion index)
40
50
60
70
80
90
100
'04 '05 '06 '07
Less than 50 = lower; greater than 50 = higher
69.7
95
100
105
110
115
'02 '03 '04 '05 '06
Industrial production Industrial production indexindex
(monthly, seasonally adjusted, 100 = (monthly, seasonally adjusted, 100 = 2002)2002)
2006: Still strong after all these months2006: Still strong after all these months
Capacity use, Capacity use, manufacturingmanufacturing
(monthly, seasonally adjusted, % (monthly, seasonally adjusted, % capacity)capacity)
73
76
79
82
85
'04 '05
2006: Robust production year2006: Robust production year
80.4
Durable goods outputDurable goods output(monthly, seasonally adjusted, $ (monthly, seasonally adjusted, $
billions)billions)
175
185
195
205
215
'04 '05 '06
2006: Rebound is evident2006: Rebound is evident
212
Motor vehicle salesMotor vehicle sales(annual, millions of cars, trucks, (annual, millions of cars, trucks,
SUVs)SUVs)
15.0
15.5
16.0
16.5
17.0
'01 '02 '03 '04 '05 '06 ''07/F
2006-2007: Why assembly is sliding2006-2007: Why assembly is sliding
16.3
Appliance shipmentsAppliance shipments(annual, millions of cars, trucks, (annual, millions of cars, trucks,
SUVs)SUVs)
60
65
70
75
80
'01 '02 '03 '04 '05 '06 '07/F
2007: Why steel demand will slip2007: Why steel demand will slip
76
Office furniture Office furniture shipmentsshipments
(annual, $ billions)(annual, $ billions)
9
10
11
12
13
'01 '02 '03 '04 '05 '06 '07/F
2007: A possible sales growth arena2007: A possible sales growth arena
11.8
Machinery shipmentsMachinery shipments(annual, $ billions)(annual, $ billions)
240
260
280
300
320
340
'01 '02 '03 '04 '05 '06 '07/F
2007: A possible sales growth arena2007: A possible sales growth arena
338
Housing market index(monthly, diffusion)monthly, diffusion)
20
30
40
50
60
70
80
'03 '04 '05 '06 '07
3535
Less than 50 = falling; greater than 50 = rising
Purchasing managers’ Purchasing managers’ indexesindexes
(monthly, diffusion index)(monthly, diffusion index)
20
30
40
50
60
70
80
'04 '05 '06 '07
Stock-Building PlansStock-Building Plans
Less than 50 = falling; greater than 50 = rising
29.5
Steel marketplace Steel marketplace updateupdate
(annual, million net tons, rounded)(annual, million net tons, rounded)
‘03 ‘04 ‘05 ‘06Mills to U.S. buyers 97 104 94110Net imports 18 28 25 37Inventory change 2 (2) 3 (4)Apparent supply 114 134 116 151Calculated use * 79 95 87112* Supply x metalworking activity calculated by Federal Reserve Board
Service center steel Service center steel inventoriesinventories
(monthly, U.S., million tons)(monthly, U.S., million tons)
10
12
14
16
18
'04 '05 '06
16.5
U.S. steel consumptionU.S. steel consumption (annual, million net tons)(annual, million net tons)
50
70
90
110
'00 '01 '02 '03 '04 '05 '06 '07/F
2006: strongest year this decade2006: strongest year this decade
100
Steel mill product Steel mill product importsimports (annual, million net tons)(annual, million net tons)
10
20
30
40
'00 '01 '02 '03 '04 '05 '06 '07/F
2007: huge slippage unlikely2007: huge slippage unlikely
32
Questions?Questions?Tom StundzaTom StundzaExecutive Editor, Executive Editor, Purchasing magazine, Purchasing. COM and Purchasing magazine, Purchasing. COM and
Purchasingdata.comPurchasingdata.comAuthor, Author, Steel Flash Report, Energy Flash Report, Chemicals Steel Flash Report, Energy Flash Report, Chemicals
Flash ReportFlash ReportAuthor & Narrator, Author & Narrator, MetalsWatch! audiotapesMetalsWatch! audiotapes225 Wyman Street225 Wyman StreetWaltham, MA 02451–1209Waltham, MA 02451–1209Phone: 781-734-8207 Phone: 781-734-8207 Fax: 781-290-3207Fax: 781-290-3207Mobile: 617-448-7474Mobile: 617-448-7474E-mail: E-mail: [email protected]
Thank you for your attentionThank you for your attention
