According to IHEA’s monthly economic report to member companies, nine of the eleven indices are up and the only two that are not up are still quite strong. To get the weak indices out of the way, here they are: Purchasing Managers Index (which is still quite high), and the Transportation Activity Index (which also is quite high). Both showed slippage in September, but neither is a focus of worry.
On the lead page of the report, the following summary paragraph appears:
The nine categories that ended up in positive territory include “new automobile/light truck sales” and this reflects the fact that consumers are still quite confident about their job security and have no issue with taking on debt to buy a new car or truck. The “new home sales” category is healthy, although it is important to note that there is a deepening division between the cities that are seeing growth between 20% and 40% and the those that are shrinking. It has all come down to which cities are generating jobs. The existing home market has not been quite as lively as the new home sector and it is much the larger of the two. The “steel consumption” category is still reflecting the desire on the part of steel consumers to hoard cheaper steel, but there has also been evidence of returning steel demand in everything from vehicles to pipelines to construction activity. The “metal prices” readings are all going up and that has been anticipated for some time. The only one that hasn’t is gold and that would suggest that fewer people are seeking shelter from inflation in this metal. The other industrial metals are all going up in response to increased demand.
The 12-page report goes on to offer in-depth analysis of all 11 indices and what impact each might have on the thermal processing industry. The full report is available for review from the Industrial Heating Equipment Association (www.ihea.org) and is an exclusive benefit of membership in the organization. If you’re interested in seeing a copy of the report, contact Anne Goyer, Executive Director of IHEA at Anne@GoyerMgt.com.
