Steel exports fell by 8.1 percent in July, ending two straight months of increases, according to an analysis from the American Institute for International Steel (AIIS) of US Census Bureau data.
The 813,052 net tons of steel exports were nearly 20 percent below the level of a year earlier.
The United States’ biggest trading partner, Canada, reduced its purchases of American steel to 400,291 net tons, 10 percent less than in June, and more than 25 percent less than last July. Steel exports to Mexico, meanwhile, fell by 8 percent month-to-month, and more than 15 percent from the previous July to 311,193 net tons. Exports to the European Union increased by almost 6 percent to 24,918 net tons, 6.5 percent less than in July 2014.
Through the first seven months of the year, aggregate exports are down 13.5 percent compared to the same period in 2014, at 6.11 million net tons. Year-to-date, exports to Canada have plummeted more than 21 percent to 2.97 million net tons, while exports to Mexico have slipped just over 3 percent to 2.35 million net tons. Exports to the European Union are up 8.8 percent on the year, at 216,499 net tons.
AIIS commented: “The sharp drop in exports to Canada this year is surely related to that nation’s recession, it’s second in seven years. Canada, the world’s fifth-largest oil producing country, saw its economy shrink in both of the first two quarters of 2015, in large part due to falling oil prices. There are signs of recovery, though, and some economists are projecting growth of 3 percent in the third quarter. Low oil prices have also slowed the Mexican economy, although growth there is expected to reach 2.34 percent this year, mediocre, but well above Canada’s 1 percent projection and about equal to the United States’ recent performance. Fiscal strains have led the Mexican government to reduce its 2016 budget by about 1.5 percent of the nation’s GDP. Oil prices are projected to rise slightly to the mid-to-high $50s in 2016, which may be a bit of a salve for both economies, but it is far from clear that this will be enough to drive substantially increased demand for steel.”