Via Metal Miner
The Construction MMI (Monthly Metals Index) continued to lack strong bullish or bearish pressure month-over-month. Overall, the index only dropped by a minuscule 0.13%. Still, many factors remain at play in the construction industry, which seems to be behind the index components' steady sideways trends.
With the winter months coming, infrastructure construction will likely slow down in the northern part of the U.S. Furthermore, interest rates remain elevated, with most analysts expecting the Fed to avoid taking a more dovish stance until 2024. While the index lacks bearish or bullish pressure in the short term, it continues to battle with bearish pressure in the long term, especially as we move into 2024.
According to the World Steel Association's Short Range Outlook for October 2023, projections for U.S. steel demand equated to a 5.8% increase in 2024 after falling 5.1% in 2023. In addition to this, the Inflation Reduction Act (IRA) and the 2022 Infrastructure Law encouraged the expansion of the infrastructure industry, while re-shoring efforts helped propel a strong rebound in the commercial building industry. Finally, the October report on national employment by the ADP Research Institute revealed that the construction industry saw a 6% increase in wages.
That was not the only good news. According to Finance-Commerce.com (2023/11), the U.S. construction industry added 23,000 jobs in October. This continued growth in construction jobs could raise the demand for steel. Indeed, steel demand rises with the increase of commercial and infrastructure projects, especially in the cases of rebar and h-beam steel. This proves encouraging for the steel sector, which continues to struggle with dropping steel demand.
Throughout 2023, the construction industry witnessed noteworthy progress despite high interest rates. Here are just some of the projects worth recognizing:
By Jennifer Kary
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