Results of the April 2018 Short Track Survey

The Sassda Short Track survey had 68 respondents in April which is a decrease on last month and is probably due to the public holidays. This survey uses the same questions as those used in the monthly International Stainless Steel Forum’s (ISSF) Short Track Report. However, the ISSF survey is only of stainless steel primary producers and thus the results are not directly comparable, but are used to give context.

For sassda respondents, the results of the first question were:

34% of sassda respondents had a positive response to the current order situation which is about the same as a month ago (35%) and slightly lower than a year ago (38%). The weighted average (2.30) is about the same as last month (2.32) and a year ago (2.29).

For ISSF Flat Products, the results were:

For ISSF flat product producers, 59% of respondents had a positive response to their orders levels, which is about the same as a year ago (61%). The weighted average is lower (2.54) compared to March 2017 (2.70)

For ISSF Long Products, the results were:

For ISSF long product producers, 82% of respondents had a positive response to their order levels which is about the same as last month (81%) and a year ago (82%). The weighted average (3.23) was better than February (3.12) and about the same as a year ago (3.22).

For sassda respondents, the results of the second question were:

36% of sassda respondents thought the current business situation was positive, which is up on last month (33%) and up on a year ago (29%). The weighted average is slightly better this month (2.28) compared to last month (2.26) and is higher than that of April last year (2.21).

For ISSF Flat Products, the results were:

The percent of respondents who felt that the current business situation was sufficient or good stood at 55% for March 2018, which is the same as February 2018 and about the same as a year ago (56%).

For ISSF Long Products, the results were:

March had a 76% positive response which was up on the previous month (69%). This was also an increase on the same month last year (69%). The weighted average of 3.05 was up on the previous month  (2.88) and slightly higher than a year ago (3.00).

For sassda respondents, the results of the third question were:

The outlook in March showed an increase in respondents’ business expectations in three months. 28% thought things would get better (compared to 22% in March). The weighted average of 2.79 is however higher than a year ago (2.59).

The above data can be converted to the Sassda Expectations Index, where the index is calculated as 0.5 x % unchanged + % better. Above 50 would predict expansion in the next three months.

This month has seen an increase of over two percentage points from March 2018.  This is an improvement compared to the same month last year (53.1%).

For ISSF Flat products. The results were:

In March 2018, 9% of respondents felt things would get better which is the better than February 2018 (5%). The weighted average (2.50) is the same as March 2017.

For ISSF Long Products, the results were:

6% of ISSF long product respondents felt that business would get better in the next three months, with 6% thinking it would get worse. This shows a decrease in sentiment on the same month last year with the weighted average dropping from 2.59 to 2.50.

The comments received from Sassda members were:

  • Clients are only purchasing what they require. No stock pieces are being kept because of price and theft, hence, everything is considered urgent.
  • [There are] good enquiries, looking forward to the next 6 months
  • International interest seems to be picking up
  • More orders need to come from US. What are the talks?
  • .. still busy with fabrications. Mainly plate work. (…) have major shut on through all sections of the mill.
  • Our stainless steel supplier is making it very difficult for us to order from them as they want orders of bigger quantities than we use to purchase.
  • Trading conditions difficult. [We] need more certainty from Government as to [the] way forward.
  • We are very optimistic that the stainless steel market in Nigeria will get better in the 3rd and 4th quarters.
  • We hope the rain will bring new life into our sector
  • We struggle to compete with overseas companies because their Steel is cheaper and their labour, [although] more expensive [is] more productive.

Orders have yet to show signs of improvement but the current business situation seems to have improved as well as business expectations for the next three months. This is supported by the recently released FNB CCI and Absa PMI figures from BER. The FNB Consumer Confidence Index skyrocketed to an all-time high of +26 in the first quarter of 2018, after hovering around -8 index points for most of 2017. The seasonally adjusted Absa Purchasing Managers’ Index erased the losses sustained in March and edged back above the neutral 50-point mark in April. The index rose by 4 points to reach 50.9 index points in April. This is more or less in line with the level recorded in February and above the average recorded during the first three months of the year.

Thanks and Kind Regards

Angie Baker
KwaZulu-Natal Regional Manager
Southern Africa Stainless Steel Development Association
Tel: +27 11 883 0119 | Cell: +27 82 604 0040