Demand out there is absolutely phenomenal, across almost every sector. Very, very strong, and it would appear to be there for the rest of this year going into next.... So we see strong demand, tight supply, record-low supply chain inventories across the space.
—Steel Dynamics CEO Mark Millett, During First-Quarter Earnings Call
Manufacturing inventories have never been lower relative to sales, and companies are struggling to find the goods they need for production and sales. This week’s batch of economic data, coupled with anecdotal comments from companies, has given us further insight into just how bad the current supply-chain issues are, and how they are increasingly impacting prices and soon sales. In this Economics Weekly, we look at the current inventory and supply situation and when it is likely to clear.
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Richard de Chazal, CFA is a London-based macroeconomist covering the U.S. economy and financial markets.