Steel Founders Society of America Industry Market Forecast

Transcription

1 Steel Founders Society of America 2018 Industry Market Forecast

2 Marketing Committee Role as defined by SFSA Board The function of the Marketing Committee is to broaden the market for and promote the use of steel castings by investigating and developing new markets, developing and implementing an effective marketing program, and communicating the advantages of steel castings to present and prospective consumers in an effective manner. To carry out its mission, the committee maintains liaison with other committees of the Society through the staff, identifies technical, business and market topics of interest to customers and SFSA members, directs development of the material and delivery of the information. The committee develops the deliverables for the marketing program such as messaging, competitive input, target market, and specific planning, The committee also performs related market research to help guide the work of the Society and prepares each year for the Society an annual forecast of steel casting demand.. 2

3 Customer Education Resources SFSA Website White Papers Design Tutorials Handbook Supplements SFSA will be adding: Webinars Training Videos Additional Content 3

4 Forecast Process Segmented primary markets Identified key customers and users in each market Analyze customer top line sales Marketing committee input Leverage Customer Associations Review analyst reports 4

5 Source: 5

6 Productivity and Wages Source: Consensus Economics 6

7 Steel Founders Society of America 2018 Industry Forecast with Rail Market Segment Estimated 2016 (tons) Projected 2017 (tons) 2017 Change (%) 2018 Forecast (tons) 2018 Change (%) Railroad 530, ,000-24% 420,000 4% Mining - OEM 85,000 90,000 6% 95,000 6% Mining - Consumables 122, ,000 23% 160,000 7% Construction 93, ,000 10% 114,000 12% Trucks 37,000 35,000-5% 39,500 13% Valves & Pumps 45,000 46,000 2% 48,000 4% Oil Field 32,000 42,000 31% 49,000 17% Military 15,200 16,000 5% 16,800 5% Other Markets 104, ,000 4% 113,000 5% Total 1,063, ,000-7% 1,055,300 6% 7

8 Steel Founders Society of America 2018 Industry Forecast w/o Rail Market Segment Estimated 2016 (tons) Projected 2017 (tons) 2017 Change (%) 2018 Forecast (tons) 2018 Change (%) Mining - OEM 85,000 90,000 6% 95,000 6% Mining - Consumables 122, ,000 23% 160,000 7% Construction 93, ,000 10% 114,000 12% Trucks 37,000 35,000-5% 39,500 13% Valves & Pumps 45,000 46,000 2% 48,000 4% Oil Field 32,000 42,000 31% 49,000 17% Military 15,200 16,000 5% 16,800 5% Other Markets 104, ,000 4% 113,000 5% Total 533, ,000 10% 635,300 8% 8

9 Railroad Forecast Railroad industry 2016 estimated 530,000 tons 2017 projected 405,000 tons 2018 forecast 420,000 tons Railcar deliveries 2016 actual 66,000 units 2017 projected 41,000 units 2018 forecast 44,000 units Near-term trough conditions 50k cars/year production resume in 2020 Hopper cars Flat cars Natural gas outpaced coal for electricity production 9

10 Customer Market Sales Forecast % change from prior year Railroad Railroads -6.1% 5.8% 4.4% 5.1% Equipment -28.1% -20.2% -0.2% SFSA Forecast -26% -24% 4% Note: Customer market data is percentage change in revenue, SFSA forecast is percentage change in tonnage. 10

11 Mining Forecast Mining Equipment and Consumable Castings Year Equipment Consumables 2016 estimated 85,000 tons 122,000 tons 2017 projected 90,000 tons 150,000 tons 2018 forecast 95,000 tons 160,000 tons Demand increase in mining equipment Replenishing low inventories Potential shortage of copper in

12 Mining Production Forecast Source: 12

13 Customer Market Sales Forecast % change from prior year Mining Mines -4.8% 14% -1% 2% Equipment -9% 5.1% 4.6% 3.7% SFSA Consumables SFSA Equipment -20% 23% 7% -10% 6% 6% 13

14 Construction Forecast Construction Equipment 2016 estimated 93,000 tons 2017 projected 102,000 tons 2018 forecast 114,000 tons Increased construction spending Customer equipment sales up (CAT, Volvo) 14

15 Customer Market Sales Forecast % change from prior year Construction Equipment -9% 8.5% 5.4% 4.5% SFSA Forecast -8% 10% 12% 15

16 Truck Forecast Trucks Class estimated 37,000 tons 2017 projected 35,000 tons 2018 forecast 39,500 tons Truck sales in US 2016 estimated 230,000 units 2017 projected 216,000 units 2018 forecast 243,000 units Freight growth is tightening capacity in US Q nd largest level of growth since late 2000 s 16

17 Customer Market Sales Forecast % change from prior year Trucks Manufacturers -3.4% 7.5% 3.5% 4.9% SFSA Forecast -29% -5% 13% 17

18 Pump and Valve Forecast Pump and Valve industry 2016 estimated 45,000 tons 2017 projected 46,000 tons 2018 forecast 48,000 tons Low oil prices Level of global trade Increase in US construction spending 18

19 Customer Market Sales Forecast % change from prior year Pumps and Valves Manufacturers -9.4% 0.3% 5.8% 4.5% SFSA Forecast -1% 2% 4% 19

20 Oil Field Forecast Oil field equipment 2016 estimated 32,000 tons 2017 projected 42,000 tons 2018 forecast 49,000 tons Oil prices stable Inventory levels low Increase in gas exploration 20

21 Crude Oil Production 21

22 Customer Market Sales Forecast % change from prior year Oil Field Manufacturers -21.4% 1.7% 10.8% 6.1% SFSA Forecast -20% 31% 17% 22

23 Military Equipment Military Forecast 2016 estimated 15,200 tons 2017 projected 16,000 tons 2018 forecast 16,800 tons Increased DoD budget Allocation uncertainty 23

24 Customer Market Sales Forecast % change from prior year Military Ground Systems -0.4% 7.5% 2.8% 5.2% Naval Systems 0.2% 1.5% 3.7% 4.5% SFSA Forecast 2% 5% 5% 24

25 Other Market Forecast Other Markets 2016 estimated 104,000 tons 2017 projected 108,000 tons 2018 forecast 113,000 tons 25

26 Forecast Summary 994,000 tons Projected ,055,300 tons Forecast % Change Excluding Rail 589,000 tons 635,300 tons Projected 2017 Forecast % Change 26