US service center inventories of steel products contracted in March, while Canadian steel inventories rose to their highest level since June 2013, according to Metals Service Center Institute data published Tuesday.
At the end of March, US service centers stocked 8.27 million st of steel products, down 2.7% from 8.49 million st a year ago and 3.6% from 8.58 million st in February. Service center stock in March represented 2.2 months of supply based on current shipping levels, down from 2.5 months in February.
Bank of America Merrill Lynch analyst Timna Tanners noted the decline was steeper than the average February-to-March decline of 0.7%. Structural inventories increased 1% month on month -- the only product to show a rise. Flat-rolled inventories fell 5.6% from the month before, according to Tanners' report.
March shipments rose 7.2% year on year to 3.68 million st and are up 8.7% from 3.38 million st in February. US service centers shipped 175,000 st/day in March, the highest average since January 2012, according to historical MSCI data.
Tanners attributed the spike to weather-related disruptions in January and February. She noted that March flat-rolled shipments are up 8.2% year on year, while plate shipments rose 6.7% and stainless shipments jumped 10.2%.
Year-to-date shipments totaled 10.7 million st through March, up 2.5% year on year. US service center shipments spike, inventories contract estimates steel consumption will grow by 5% in 2014, with increased demand related to nonresidential construction.
CANADIAN SERVICE CENTERS BOOST SHIPMENTS
Canadian service center inventories were 1.47 million st at the end of March, down 14.9% from 1.73 million st in March 2013, but up 5.5% from nearly 1.4 million st in February.
At current shipping rates, inventories in March represent 2.9 months of supply, down from 3.1 months in February.
March inventories were the highest since June 2013, when Canadian inventories totaled 1.48 million st, representing 3.3 months of supply.
Canadian steel shipments totaled 499,700 st in March, up 4.8% from 472,200 st in March 2013. Shipments rose 11.4% from February's 448,500 st. Year-to-date steel shipments are down 1% year on year with 1.44 million st shipped in first-quarter 2014.
