Dear Friends,

We are now in the middle of summer and construction here in the Southeast continues to be very strong. The US economy isn’t as strong as it is here in the Carolinas, Georgia, and Florida, as many people and companies are leaving other parts of the country to live here in the Sunbelt. We expect that to continue well into the future.

There has been some downward movement in the commodity markets. See below for a closer look at current pricing trends.

Many of the industry’s standard commodity-based items have seen change this month. Pricing has crested on many of these items and a softening within the market is beginning to occur.

Scrap metal pricing settled down another $30 per ton from June’s pricing to finish at $460 per ton in July. This was not as significant as a drop as was expected, but the downward trend on scrap pricing continued for another month. This recent pattern is having an impact on pricing domestically.

Wire mesh reinforcing has seen the quickest market softening. Mills are currently sitting on larger than normal amounts of inventory and looking to move product quickly. Many distributors are still working through the stockpiles of inventory that were amassed over the past year, so inbound purchases to the mills are slow. Mill purchases should pick up once these stockpiles are reduced, but the market will continue to soften until that happens.

Rebar has not only been impacted by the softening scrap pricing, but now faces more competition from importers. A soft international rebar market, combined with a strong US Domestic market, has caused international manufacturers to shift focus towards the US. For the first time in months, the price gap between US domestic rebar and imported rebar is large enough to warrant domestic fabricators and distributors to begin buying import rebar again. The price gaps between domestic rebar and import rebar increases the closer you get to the import rebar’s US port of origin. With the cost of transportation still extremely high, the domestic vs. import pricing gap in markets farther away from the ports is not near as dramatic. Import appears to be gaining some of the market share back that it lost over the past few years.

The lumber market is still bouncing off the bottom. Most species and sizes are readily available with lead times running around two weeks from time of purchase order. Slight increases one week are followed by slight reductions the very next. These slight movements up and down have resulted in no real measurable change in pricing since June.  Trucking continues to be an issue. Any small increase seen between loads is mainly being driven by trucking costs and has little to do with actual product fluctuations.

Polyethylene sheeting pricing has also remained flat since June. Demand remains strong and the poly manufacturers remain busy. Single size loads are currently running at a three-to-four-week lead time, with mixed size loads in the four-to-five-week lead time. The poly market feels stable and there is not much expectation for near term change in the current environment.

Contractors’ input costs rose faster than their bid prices from May to June but bid prices rose faster over the past 12 months, according to Bureau of Labor Statistics data posted on July 14. Specifically, the producer price index (PPI) for material and service inputs to new nonresidential construction increased 1.1% for the month and 16.8% year-over-year (y/y).

Click here for the latest update on the construction economy from Ken Simonson, the chief economist of the AGC.

Catching up with our Customers

This month, we are catching up with the team over at Superior Masonry, based out of Fort Mill, South Carolina. Superior Masonry Unlimited, Inc was incorporated in South Carolina upon an acquisition in 2002, and under its leadership, the company has grown to its current output of keeping six, sixteen person crews busy. Their goal is to have eight crews consistently busy by the middle of 2023. Specifically, Superior specializes in high production masonry installations such as apartments, student housing, retirement housing, hotels, medical office buildings, warehouses and more. Read more on our blog.

Featured Manufacturers

Owens Corning

Premier supplier of insulation, roofing, and fiberglass composites

GluDown

Superior construction and adhesive solutions.

Hohmann & Barnard

Provider of quality and innovative products that architects, engineers, and contractors have come to rely on since 1933.

Associate Profile

Lauren Gunter

Sales Manager, Charleston, SC

Our Associate Spotlight this month is of Lauren Gunter, a Sales Manager at our Charleston, SC branch. Prior to joining us in January she was with Port City Concrete (2016-2021) and Republic Services (2004-2016). With her having a lot of contacts from her time with Port City Concrete, Lauren was able to make an immediate impact after starting with us. A Charleston native, Lauren graduated from Bishop England High School and earned a B.S. in Criminal Justice at the University of South Carolina. She and her husband, Paul have three boys, Finn (14), Sawyer (11), and Cooper (8). Among her many hobbies are boating, shopping, golfing, fishing, crabbing, swimming, attending football and baseball games, going to concerts, and hanging out with friends and family.

Our management article this month is a chapter from my book on interviewing tips as printed in the July issue of the Upstate Business Journal. One of the most important parts of a manager’s job is hiring top notch people. Click here to read what has worked for me over the last 40 years.

Lessons from the Trenches:

Interviewing Tips

That’s all for this month. As always, if we ever fail to meet your expectations, I’d consider it a personal favor if you would let me know about it. My contact info is below.

Best regards,

Jim Sobeck
President & CEO 864-263-4377 (Direct Line)
jim.sobeck@newsouthsupply.com

Main Office/Branch: Greenville, SC

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Author of The Real Business 101: Lessons From the Trenches.

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