Global Fastener News

The Fastener Distributor Index (FDI) increased slightly in December to 48.1 from November’s 46.4, hampered by a “significant” drop in sales (36.5 vs. 48.9) and employment (47 vs. 51.7) during the month.

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Improvement in supplier deliveries (56.1 vs. 46.7) and customer inventories (48.5 vs. 40) partially offset declines.

Only 15% of respondents indicated sales came in above seasonal expectations, well below the 34% average throughout 2024 and 33% in November.

Employment remained mostly stable, with a full 76% of responses saying employment levels were similar. Similarly, pricing looked mostly stable with November (70% of responses).

The Forward Looking Index registered a 51.4 reading, creeping lower from November’s 52.3. “With a reading above 50, we view the FLI as indicative of expectations among participants for slight acceleration coming into the new year,” wrote R.W. Baird analyst David Manthey (CFA) with Quinn Fredrickson (CFA).

More than six in 10 participants (61%) forecast better activity levels over the next six months, while 15% see lower and another 24% forecast stable trends.

“This is more optimistic on balance than in November when 43% forecast acceleration, 33% stable, and just 23% deceleration – albeit coming off a weak December,” wrote Manthey. “We believe this suggests that overall sentiment among participants leans cautiously optimistic heading into 2025, although some caution persists due to ongoing macroeconomic/inflation/rate uncertainties.”

The six-month outlook index remaining robust at 72.7 (November 60) — the highest reading since August 2021.

“Considering the current length of the ISM PMI down-cycle and persistently downbeat fastener market conditions for much of the past two years, future Fed rate cuts, and potential post-election acceleration with emphasis on domestic manufacturing, we consider a turn in conditions ahead to be a reasonable expectation.”

With the election decided and ongoing discussions around tariffs, participants expressed varying expectations for the future.

“[It] appears things are ‘status quo’ now that the election and year are over,” one respondent noted. We don’t expect much in the way of overall business jumping but feel domestic manufacturing will benefit from all the latest tariff talks.”

Others remain cautious about potential impacts on consumer demand and pricing adjustments.

“We continue to be nervous about Trump’s new tariffs. They will affect everything. The higher they are, the worse the overall impact.”

Still, cautious optimism seems to be the general tone on 2025 expectations.

“2024 was a very strong year for us and we have higher expectations for the new year.” Echoing this, another participant commented, “2024 will be our second best behind 2022. Hoping 2025 brings good things for all.”

Fastenal reported December fastener sales were better than expected at 0.1% growth.

The FDI is a monthly survey of North American fastener distributors conducted by the FCH Sourcing Network, the National Fastener Distributors Association and Baird. Web: fdi.com